Coinbase denies proprietary trading
Coinbase’s chief policy officer Mike Lempres has insisted that the company “does not engage and proprietary trading”.
The cryptocurrency exchange and wallet provider issued the denial after the New York Attorney General Barbara D. Underwood claimed that almost 20% of transactions on Coinbase’s platform were attributable to the company. Proprietary trading involves a firm investiong fro its own gain, rather than on behalf of its clients.
The NY Attorney General’s Virtual Markets Integrity Report highlights concerns over the current cryptocurrency trading standards; particularly platforms’ ability to prevent abusive trading activity and protect customers’ funds.
Blog post response
In a blog post, Lempres responded: “In order to provide an easy-to-use customer experience, Coinbase Consumer quotes a price and then quickly fills the order from our exchange platform (Coinbase Markets)… When Coinbase executes these trades, it does so on behalf of Coinbase Consumer customers, not itself.”
Lempres said that Underwood’s statement that almost 20% of executed volume on Coinbase’s platform was attributable to its own trading was “misreported in the media as ‘self-trading”, which is inaccurate.”
He added: “We welcome oversight and will continue to work with regulators to promote the cryptocurrency ecosystem.”
Earlier this week, Coinbase announced that it had hired Brian Brooks as its new chief legal officer. He previously served in a similar role with US mortgage giant the Federal National Mortgage Association, aka Fannie Mae.