Coinbase gives up data to New York attorney general

Coinbase gives up data to New York attorney general

New York’s Attorney General (AG) Eric Schneiderman asked a number of cryptocurrency exchanges to turn over corporate data last month. While some exchanges like Kraken told him to basically get stuffed, Coinbase has agreed to the request.

In a public response to the request, and perhaps as a means of saving face, Coinbase said, “We applaud the [Office of the Attorney General] for taking action to bring further transparency to the virtual currency markets.” The response is part of a five-page letter penned by the exchange’s chief legal and risk officer, Mike Lempres, who further detailed the $150 billion in assets held by the company, as well as its received funding of $225 million and its financial position, which he describes as “a profitable and self-sustaining business.”

Schneiderman, who has never been an ally to the cryptocurrency industry, sent a request to 13 exchanges in April that demanded information on 32 separate points. He solicited information about their operations, their leadership, privacy, funding and relationships with other financial institutions, and much more. As any power-branding zealot would do, he only gave the exchanges two weeks to comply.

Coinbase’s letter further details its involvement with law enforcement and regulatory agencies around the world, its system upgrades (which, according to Lempres, helped the platform maintain 99.99% uptime in April) and Coinbase’s “state of the art” cybersecurity program. Lepres also stated that the company is a federally-regulated money service and currently holds licenses to operate in 31 states, including in New York with its BitLicense.

Coinbase may have reported “99.99% uptime” for April, but it wasn’t without issues in the month. From April 12 to April 16, users reported not receiving email confirmations for instant purchases, a glitch that Coinbase subsequently corrected. On April 2, purchases using the exchange’s Xfers payment method were unavailable for about four hours, but no sells were apparently affected.

The public version of the information provided is a watered-down version of what was presented to Schneiderman per a request by Lempres made from the start. Lempres had requested “confidential treatment” to the entire response, delivered to the AG via Coinbase’s own “encrypted end-to-end secure file exchange service consistent with our security protocol.”

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
New York's AG opens inquiry into cryptocurrency exchanges

New York’s AG opens inquiry into cryptocurrency exchanges

Regulators in the state of New York have announced an inquiry into several leading cryptocurrency exchanges, with as many as 13 separate operations coming in for closer scrutiny.

The inquiry has been instigated by the Attorney General Eric Schneiderman, as part of the state’s new ‘Virtual Markets Integrity Initiative,’ with the initial enquiry described as “a fact-finding inquiry into the policies and practices.”

According to a press release issued by the New York Attorney General’s Office this week, initial letters were sent to over a dozen exchanges, requesting information about their business practices and systems—including whether they currently use bots, or whether they have any conflicts of interest.

Schneiderman described the move as part of a drive to help consumers gleam the ‘basic facts’, vis a vis transparency and accountability in their investments.

“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,” he said.

The exchanges targeted reads like an industry who’s who, covering the majority of major operators in the sector. The full list has seen bitFlyer, Binance, GDAX, Gemini, itBit, Huobi.Pro, Bitfinex, Poloniex Bitstamp, Bittrex, Gate.io, Tidex and Kraken all targeted with initial requests for information.

Suggesting the move was about focusing on ‘key issues’ affecting consumer investors, Schneiderman’s office said that it was preparing to extend its focus to exchanges that specifically choose not to operate within New York, on account of its current regulatory regime.

“We are aware that certain trading platforms have formal rules barring access in New York and may not have a license to engage in virtual currency business activity in New York. Among other topics, we are asking platforms to describe their measures for restricting trading from prohibited jurisdictions,” the attorney general’s office stated.

The news comes at a time of increasing scrutiny for cryptocurrency exchanges, with regulators worldwide turning their focus to exchanges, as well as developing local systems for regulating cryptocurrency businesses.

Note: Tokens in the SegWit chain are referred to as SegWit-Coin BTC (inaccurately called Bitcoin Legacy or Core by many) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.