New York AG Wants More Info From Crypto Traders


New York Attorney General Eric Schneiderman has announced the launch of the Virtual Markets Integrity Initiative, a fact-finding inquiry into the policies and practices of cryptocurrency trading platforms.

“With cryptocurrency on the rise, consumers in New York and across the country have a right to transparency and accountability when they invest their money. Yet, too often, consumers don’t have the basic facts they need to assess the fairness, integrity and security of these trading platforms,” said Schneiderman. “Our Virtual Markets Integrity Initiative sets out to change that, promoting the accountability and transparency in the virtual currency marketplace that investors and consumers deserve.”

Schneiderman is seeking information from 13 cryptocurrency trading platforms, including Coinbase and Gemini Trust Company, about their operations.

The letter includes a questionnaire about such issues as ownership and control, basic operation and fees, trading policies and procedures, outages and other suspensions of trading, internal controls and privacy and money laundering.

“Ensuring that enforcement agencies, investors and consumers have the information they need to understand the practices and the risks on these platforms is critical, given reports of the theft of vast sums of virtual currency from customer accounts, sudden and poorly explained trading outages, possible market manipulation and difficulties when withdrawing funds from accounts,” according to the press statement.

The other companies that received the letter include bitFlyer USA; iFinex (Bitfinex); Bitstamp USA; Payward (Kraken); Bittrex; Circle Internet Financial Limited (Poloniex LLC); Binance Limited; Elite Way Developments (; Gate Technology (; itBit Trust Company and Huobi Global Limited (Huobi.Pro).

“The Initiative stems from the Attorney General’s duty to protect consumers and ensure the fairness and integrity of the financial markets. Before trading on a new platform, sophisticated investors routinely demand robust disclosures, allowing them to assess the platform’s operations and the adequacy of its policies and internal controls,” the release continued. “The questionnaire delivered to the virtual currency platforms asks for similar information so that average investors can better understand the risks and protections.”

Trading platforms have to respond before May 1, the press statement said. One company has already announced that it plans to comply with Schneiderman's request.

"Gemini applauds the Attorney General's focus on this industry and the Virtual Markets Initiative, and we look forward to cooperating with and submitting our responses to the questionnaire that has been circulated," Tyler Winklevoss, CEO of Gemini, said in a statement to CNBC.



The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.