Trading Firms Propose 'Bad Actors Blacklist' to Clean Up Crypto Industry
Cryptocurrency trading firms held a Chicago meeting to discuss ways to prevent the rising numbers of hacks and scams in the industry.
A group of cryptocurrency trading firms has come together to discuss ways to prevent the rising number of hacks and scams in the industry.
Ripple, market maker Cumberland, Michael Novogratz’s Galaxy Digital Holdings and over 30 other firms met at a recent round-table event in Chicago for the initiative, Bloomberg reported Thursday.
Creating a list of entities involved directly or indirectly in criminal activities such as money laundering and drug trafficking was one of the ideas. Giving companies in good standing some form of accreditation was another, according to the report.
Another route could be to set standards for verifying identities of customers and their sources of funds. CORA may also share information on actors defaulting on derivatives trades.
Darius Sit, managing partner at trading firm QCP Capital, told the news source:
Such a move to bring more self-governance to the crypto industry is something that regulators have been keen to see, he added.
The event was organized by Crypto OTC Roundtable Asia (CORA), a "loose association" of crypto businesses, according to Bloomberg. The firms are yet to take any final decision on the next steps. The group reportedly plans to meet again in the near future to move forward on the discussed ideas.
Notably, on the day of the event itself, hackers stole 7,000 bitcoin (worth over $40 million) from cryptocurrency exchange Binance.
Blockchain analytics firm CipherTrace recently estimated that losses arising from cryptocurrency hacks and fraud may have already reached about $1.2 billion in the first quarter of this year alone (a number that includes Bitfinex's allegedly missing $850 million). The figure is almost 71 percent of the $1.7 billion loss seen over the whole of 2018, the firm said.
Chicago image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.