It is alleged that the administration of US President Joe Biden will pressure Congress to demand that Bitcoin (BTC) and altcoin exchanges keep their clients’ money separate from their own institutional funds. Here are the details…
Bitcoin and altcoin exchanges targeted by the Biden administration
Coinbase (COIN) stated that if the company recently declared bankruptcy, customers’ money could be used and customers could not be paid attracted the attention of the US administration. Authorities plan to force US lawmakers to address the issue by insisting that a future legal framework requires crypto firms to keep client assets closed. This type of custody rule is standard for financial firms like futures platforms, but crypto exchanges mix their funds with clients’ assets. This is a situation that the US administration wants to end.
Based on a discussion in the US Financial Markets Working Group’s report on stablecoins last year, federal officials are planning to launch a crypto market in the coming weeks. pressure to regulate. Management thinks that trading platforms should still allow clients’ assets to be pooled, allowing companies to manage trades internally without having to record every move on a Blockchain.
Coinbase’s SEC statement sparked the allegations
Coinbase, a publicly traded company that is one of the largest exchanges in the industry, Kriptokoin.com As we previously reported, “crypto assets that we hold in custody on behalf of our clients in the event of bankruptcy are subject to bankruptcy proceedings and such clients may be considered our general unsecured creditors,” in a filing with the Securities and Exchange Commission (SEC) last week. had used the words.
This suggested that a misstep by Coinbase could potentially lock customers’ tokens indefinitely or use these tokens to pay other creditors. “In a digital wallet, don’t think you really own your tokens,” Gary Gensler, Chairman of the Securities and Exchange Commission (SEC) said at a conference this week, underscoring some of the federal government’s concerns about protecting investors’ assets.
