The Office of Compliance Inspections and Examinations (OCIE) of the US Securities and Exchange Commission (SEC), which is tasked with the duty of regulating and overseeing the operations of cryptocurrency in the USA has released a report which shows cryptocurrencies to be a top priority for the year 2019.
It is stated in the report that,
” The digital asset market has grown rapidly and may present risks to retail investors. The number of digital asset market participants, including broker-dealers, trading platforms, and investment advisers, also continues to increase. “
It also said that,
” For firms actively engaged in the digital asset market, OCIE will conduct examinations focused on, among other things, portfolio management of digital assets, trading, safety of client funds and assets, pricing of client portfolios, compliance, and internal control.”
It is not the first time that SEC has expressed its concerns over the matters of safety and ill regulations over the ever-growing and dynamic cryptocurrency markets, They have included cryptocurrencies even in the report published last year although the area of concern was different.
It stated that,
” Areas of focus will include, among other things, whether financial professionals maintain adequate controls and safeguards to protect these assets from theft or misappropriation, and whether financial professionals are providing investors with disclosure about the risks associated with these investments, including the risk of investment losses, liquidity risks, price volatility, and potential fraud. “
Last year, They have even filled subpoenas over several cryptocurrencies companies alleging them for being involved in illegal practices. All cryptocurrencies fall under the direct jurisdiction of SEC as securities apart from Bitcoin and Etherium as of now. Last year Jay Clayton, The newly appointed chief of SEC said that IPO’s have very little investor protection laws when compared to traditional investments.