Coinbase, Binance, Kraken and Other Crypto Firms Should Explain How They’re Fighting Fraud, Says US Congressman

Coinbase, Binance, Kraken and Other Crypto Firms Should Explain How They’re Fighting Fraud, Says US Congressman

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A US Congressman from Illinois is asking prominent federal agencies and crypto exchange platforms for information on how they combat digital asset fraud.

In a new press release, Representative Raja Krishnamoorthi requests information from Coinbase, Kraken, Binance, FTX, and KuCoin on what they are doing to protect American investors from crypto scams.

Krishnamoorthi also sent letters to the U.S. Treasury Department, the U.S. Securities and Exchange Commission (SEC), the Commodities Futures Trading Commission (CTFC) and the Federal Trade Commission (FTC) requesting the same information.

The Congressman says he’s worried about a lack of central power, irreversible transactions, and the limited understanding the public has on crypto fraud.

“As stories of skyrocketing prices and overnight riches have attracted both professional and amateur investors to cryptocurrencies, scammers have cashed in.

The lack of a central authority to flag suspicious transactions in many situations, the irreversibility of transactions, and the limited understanding many consumers and investors have of the underlying technology make cryptocurrency a preferred transaction method for scammers.

For all these reasons, I am concerned about the growth of fraud and consumer abuse linked to cryptocurrencies.”

Krishnamoorthi says the information he’s requesting will help Congress be informed when creating legislative solutions for the digital assets market.

According to the press release, the crypto markets have vulnerabilities that the government has yet to patch up.

“Consumers are often unaware of the patchwork of resources available to inform their cryptocurrency investing decisions, and insurance companies are reluctant to provide insurance to individual consumers given the lack of regulation of digital assets.

Despite these vulnerabilities, the federal government has been slow to curb cryptocurrency scams and fraud, and existing federal regulations do not comprehensively or clearly cover digital assets under all circumstances.”

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Featured Image: Shutterstock/Jamo Images

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