While cryptocurrency allows users to remove the broker, some investors still rely on their brokers to make sure their assets are safe. The Securities Exchange Commission (SEC) is now examining this report and the way these intermediaries are actually involved.
The only way to make an informed decision about anything is to question it by making sure you have gathered all the facts.
This seems to be exactly what the SEC is doing. According to Bloomberg the intermediaries found themselves in the spotlight of the regulator. This last is looking at issues such as trading fees and the level of assistance provided by these financial advisors.
Knowledge is power
At first glance, it may seem that the SEC is peering and trying to cause problems but in reality it could be the other way round. The regulator is simply doing the due diligence in understanding the industry in the best way possible.
John L. Jacobs expressed his point of view on the search for SEC clarity. Jacobs, who is the executive director of Georgetown University's Center for Financial Markets and Policy, said:
They are trying to understand the whole ecosystem. They are still struggling to make sure this is organized in an efficient market.
Securities Exchange Commission requires total transparency
This review process is conducted by the Office of Compliance Inspections and Examinations (OCIE), the results of which will be forwarded to the SEC for further investigation if justified. The former has previously discussed how these brokers or advisors have to protect their clients' funds:
Cryptocurrency and ICO markets have grown rapidly and present a number of risks for retail investors. Areas of interest will include, among other things, whether financial professionals will maintain adequate controls and safeguards to protect these resources from theft or misappropriation.
Anonymous sources with knowledge of the recent review have continued to explain that companies were formerly the SEC if and when they engage in any type of encrypted business. Some companies have adhered to the new requirements and even taking their own initiative and actively seeking the advice of the SEC.
Jeff Bandman, director at Bandman Advisors, touched a little bit this:
Looks like he's going from where the house is on fire to incorporate the supervision of the intermediaries.
Because the market remains largely unregulated, these companies sometimes require the SEC to provide information on whether or not their clients' assets are securities. Being able to make mistakes could lead to legal actions against these entities.
ETF stakeholders are likely to hope that the Securities Exchange Commission will have a clear understanding of all things encrypted before the next month. With a story of saying no, the enthusiastic crypts of the ETF hope for a yes in September.
Do you think this review is a step towards obtaining a positive result from Bitcoin's ETF? Let us know in the comments below!
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