Four of the biggest cryptocurrency exchanges have joined forces to become a self-regulatory organization that aims to stamp out the bad guys in the space.
The Virtual Commodity Association
Cameron and Tyler Winklevoss, co-founders of the Gemini exchange, created the Virtual Commodity Association (VCA).
The aim of the VCA is to develop industry standards and promote transparency in the market. Fundamentally, it will also be working with regulators such as the U.S. Commodity Futures Trading Commission (CFTC) to eliminate fraud and market manipulation.
In a statement published yesterday, the remaining cryptocurrency exchanges involved include Bitstamp, BitFlyer USA, and Bittrex. The VCA is expected to hold its first meeting next month. The participants will discuss many things, one of which is:
Guidelines for best practices and rules-based marketplaces that will promote fairness, transparency, risk management, and liquidity.
Maria Filipakis, the VCA’s interim executive director, added:
I applaud the VCA and its members in their commitment to strengthen the digital asset industry’s regulatory landscape, rules for the protection of customers, and bring forth industry setting best practices and market transparency.
Prior to this, Filipakis worked for the New York Department of Financial Services. While there, she helped create the state’s BitLicense.
Interestingly, in light of the news, Brian Quintenz, a CFTC commissioner, said in a statement that the VCA was a “positive step.” He added:
Given the absence of federal oversight jurisdiction in the crypto market, in February and again in March of this year I called on the crypto platform community to come together and develop a self-regulatory organization-like entity that could develop and enforce rules. I am pleased that progress has been made on such a concept. Ultimately, an independent and empowered SRO-like entity could have a meaningful impact on the integrity and credibility of this young marketplace.
Winklevoss’ Bitcoin ETF
Aside from creating the VCA, the Winklevoss twins are working to launch the first Bitcoin exchange-traded fund (ETF). However, it hasn’t been easy for the pair.
Back in March, Cameron and Tyler proposed a Bitcoin ETF to the U.S. Securities and Exchange Commission (SEC). However, this was denied by the agency. The twins then tweaked their proposal, resubmitting it, but the SEC remained firm on its earlier decision last month. According to reports, officials denied the application on the grounds of concerns regarding price manipulation with Bitcoin.
Interestingly, SEC Commissioner Hester M. Peirce is reported to have disagreed with the Winklevoss ETF rejection. Furthermore, she notes that the decision stifles innovation and undermines investor protection.
A decision on the VanEck/SolidX Bitcoin ETF proposal has been delayed until September by the SEC. It remains to be seen which way the agency will decide. However, if is it a positive result, it will help to boost the market.
What do you think of the VCA? Do you think it will aid regulators? Let us know in the comments below.
Images courtesy of Shutterstock.
