BitOoda Global & Regulatory Analysis, 1/13/2020: Tightening Regulation Affecting Industry Landscape

Among the developments we monitored this week — including new enforcement actions, updates in the SEC-Telegram standoff, and the continued consolidation of Europe’s crypto rules — the one we found most interesting was Deribit’s decision to move its operations to Panama.

In our view, this move does not reflect the reality of how the global regulatory landscape is evolving: the EU is closing its KYC/AML gaps with AMLD5, the SEC continues to clamp down on U.S. markets (including an action against an alleged mining scam), and the new FATF rules are being implemented worldwide. The move is even more questionable given the launch of new crypto options platforms (Bakkt and CME), which provide traders with alternatives to exchanges that could be seen as operating below current KYC standards.

The broader point — and the tie-back to BitOoda — is our fundamental belief in the importance of working with regulated entities in a compliant manner. Our regulated IB and BD allow our platform to handle a broader range of assets, develop more advanced bespoke products, and confidently surge into new and emerging markets on our clients’ behalf. As firms face regulatory scrutiny, attempting to escape the increasingly-defined global rules is counterproductive for the continued maturation of the market as a whole.

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