Great Potential, Major Risks

A few figures contextualizing the state of crypto market integrity and regulation. Sign up for our newsletter or visit our knowledge page to keep in the know.

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The Great Potential of Digital Assets

Blockchain-powered trading enables digital assets and the prospect of more accessible and efficient capital markets, liquidity in formerly illiquid assets, and numerous other advantages. Beyond the prospect of new financial products, digital assets also provide a much-needed opportunity to drive the financial industry, which too often still exhibits legacy technology, culture and standards, into the 21st century.

At a time when the number of US IPOs is lower than in the 1970s, it’s no surprise Wall Street is keen on adopting this new asset class and unveiling its potential.

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The Threat of Fraud and Manipulation

If the potential is so great, what’s holding back the mass adoption of digital assets? One of the major concerns for institutional investors is market integrity. With as much as 70%-90% of the volume traded in crypto exchanges driven by trade manipulation, and markets rife with fraud, the risk of regulatory fines, reputational damage and client protection is still too high.

Solidus is among the companies leading the effort for safer, more transparent markets.

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The Challenge of Evolving Regulation

As crypto markets mature and expand, governments are trying to do their part and provide regulatory frameworks that would encourage better behavior and safer markets. Globally, legislation, regulation and enforcement is intensifying by the week, with new rules introduced, as well existing rules utilized to sanction bad actors. If in 2017, the crypto industry seemed like a Wild West with no supervision, in 2018 regulators made it clear that the state won’t last. In the US alone, authorities inflicted at least $2.3 million in fines on digital asset firms, and made it clear scrutiny will only increase in 2019.

For digital asset service providers, the need to be proactive and work towards compliance is more pressing than ever.

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The Risk of
Non-Compliance

Failing to comply with regulation can be cost millions and be a make-it-or-break-it for young startups and veteran institutions alike. Here are some recent crypto enforcement actions.

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5 years

Jail sentence for two executives at Komid, a Korean crypto exchange, for wash trading and manipulating volume reports.

$2.7 M

Fines and disgorgement fees US authorities executed against AriseBank for deceiving promising investors regualted crypto services, after a federal court settlement

$500,000

Fines and disgorgement fees, as well as cease and desist order, US authorities executed against blockchain protocol CoinAlpha, for accepting money from breaching securities laws.

$338,000

Fines and disgorgement fees US authorities executed against EtherDelta, a Texas digital asset exchange, for operating as an unregistered securities exchange

~200

The number of ongoing investigations, according to reports, including subpoenas and court orders, against digital asset firms in the US and UK

$2,350,000

In fines and disgorgement, at least, enforced by regulators against digital asset businesses in 2018. Scrutiny is expected to increase in 2019.

132

Times the word manipulation appears in the SEC’s rejection of a Bitcoin-ETF application, a 90-page document. The word surveillance appears 120 times.

30%

Average reduction in false positives, reported by clients, when switching from a legacy solution to Solidus’ platform. And constantly improving.

Press

2.12.2020

Nine Startups Named to FinTech Sandbox Demo Day Lineup

FinTech Sandbox has revealed nine FinTech startups chosen for Demo Day 7.0, to be hosted at Moody’s Analytics offices on April 2nd, in conjunction with New York FinTech Week. Demo Day is an opportunity for a select audience to go under the hood of robust technologies solving the industry’s most pressing challenges. Firms will showcase products developed. They are: Solidus Labs’ cloud solutions allow financial institutions to orchestrate all their compliance needs in one unified, digital asset-native and ML-powered hub.

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9.26.2019

SEC’s ‘Crypto Mom’ Hester Peirce Believes Digital Assets Could Be the ‘Money of Internet’

SEC’s Hester Peirce stated that cryptocurrencies prove to be important “transaction mechanisms” and their “store of value” is an important function of the digital assets. SEC Commissioner Hester Peirce, also popular as ‘crypto mom’ for her crypto-friendly news, once again spoke in favor of digital assets during the recent cryptocurrency compliance Dacom summit in New York hosted by Solidus Labs today. Peirce spoke in details about SEC’s views on digital currencies saying that regulators are currently active extremely ‘paternalistic’. Besides, she also had an extensive discussion on different measures the agency can take to improve regulations.

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9.30.2019

SEC Commissioner Said Cryptocurrency Will Become “Money Of The Internet”

Peirce says that she believes cryptocurrencies as a “transaction method” and store of value is important class of cryptocurrencies. Peirce further added: “Store of value, I think, is a really important function. I do think that we’ll see as technology changes, that they become much more the money of the internet.”

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9.30.2019

SEC Commissioner Speaks Positively About Digital Assets Despite Recent Enforcement Flurry

The U.S. Securities and Exchange Commission (SEC) regularly draws the ire of crypto proponents who are frustrated at its failure to support innovation and entrepreneurship. Despite this, some have warmed to the agency’s opinionated commissioner Hester Peirce, who has adopted the moniker of “Crypto Mom.” At a compliance conference this week, Peirce spoke positively about crypto assets, expressing the belief that they could one day become “the money of the internet.”

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9.27.2019

US SEC’s Crypto Mom: ‘I Think We Need to Be a Little Less Paternalistic’

Peirce’s benign attitude towards digital assets has earned her the moniker Crypto Mom, towards which she expressed some fondness at the beginning of her appearance at today’s summit: “It’s been an honor to be adopted by a group of people who are really thinking in such exciting and interesting ways and trying to think about ways to change the world.”

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9.27.2019

SEC Commissioner Hester Peirce says digital assets could one day be ‘the money of the internet’ - Yahoo Finance

At a cryptocurrency compliance summit in New York hosted by Solidus Labs today, SEC Commissioner Hester Peirce spoke about the U.S. Securities and Exchange Commission's (SEC) views on cryptocurrencies, how the U.S. can improve the process for new regulations, and how the SEC enforces cryptocurrency fraud.

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9.23.2019

SEC Commissioner Hester Peirce aka ‘Crypto Mom’ to Hold Q&A at Solidus Labs’ Compliance Summit - Coinspeaker

Compliance solutions provider Solidus Labs has secured a stellar guest to head up its maiden crypto compliance summit. Solidus Labs‘ one-day event, taking place at Hogan Lovells, Madison Avenue on Thursday, will culminate in a talk by reigning SEC Commissioner Hester M. Peirce. Also speaking at the event, which includes a series of panel discussions, will be Coinbase Chief Compliance Officer Jeff Horowitz and representatives from Circle, CryptoCompare, and David Weild IV, former Vice-Chairman of NASDAQ.

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9.23.2019

Five crypto and blockchain events to keep on your calendar - Cryptoslate

Of course, nobody can attend them all, so we’ve profiled five crypto and blockchain conferences that you should keep on your radar. Pick your favorite, and consider making an appearance at your favorite event. #2 DACOM Summit: New York City, Sept. 26 New York City, New York The Digital Asset Compliance and Market Integrity (DACOM) Summit is a one-day event in New York City that brings together crypto 20 speakers and more than 200 crypto compliance professionals who provide professional development for crypto compliance personnel.

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9.11.2019

DACOM Summit By Solidus Labs Brings Together Crypto Compliance Leaders, with SEC Commissioner Hester Peirce Confirmed as Keynote Speaker

Crypto-native compliance solutions provider, Solidus Labs, announced today the partial lineup for Digital Asset Compliance & Market Integrity Summit (DACOM), its first industry summit, taking place on September 26 in New York City. The full-day event will be hosted by law firm Hogan Lovells and held in partnership with industry membership organization Global Digital Finance.

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11.4.2019

DACOM Summit By Solidus Labs Brings Together Crypto Compliance Leaders, with SEC Commissioner Hester Peirce Confirmed as Keynote Speaker

NEW YORK, NY / ACCESSWIRE / September 4, 2019 / Crypto-native compliance solutions provider, Solidus Labs, announced today the partial lineup for Digital Asset Compliance & Market Integrity Summit (DACOM), its first industry summit, taking place on September 26 in New York City. The full-day event will be hosted by law firm Hogan Lovells and held in partnership with industry membership organization Global Digital Finance.

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8.20.2019

Coindesk Korea: See you in Busan! Protagonists of the new Crypto Order!

Chen Arad is currently Chief Marketing Officer for Solidus Labs, a cryptocurrency compliance and AML solution provider based in New York . A native of Israel, he served as spokesman for the Israeli army. Since then, he has worked as a lecturer and writer for media and political science at Brandeis University. After joining Solidus's Lab, he is a founding member of the Global Digital Finance (GDF), a non-profit organization that writes the Code of Conduct for the digital asset industry. What do you think about the recommendations made by the FATF last June at the General Assembly? “FATF's recommendations have been confirmed by the G20 countries and are already being implemented. We welcome the efforts to introduce FATF's global financial regulatory standards into the digital asset arena and to improve market transparency and integrity. Solidus Lab's role is to help by providing compliance solutions among regulatory and digital asset innovators. Regulatory regulations in the crypto industry will be tightened in the future. We look forward to working with industry and regulators to set standards and better crypto asset policies through DAXPO. ” In describing Solidus, what does it mean to use the concept of RegTech? “Simply speaking, technology related to regulation. This means technology that helps companies communicate and interact with regulators to comply with government regulations . This is especially important when regulators deal with emerging technologies such as blockchain and digital assets. For example, it is estimated that 70-90% of the trading volume is currently manipulated in major cryptocurrency markets. In this situation, regulators will never approve crypto assets. SolidusLab's crypto-assets LegTech solutions will bridge the industry and regulators by addressing compliance issues with digital assets that are fundamentally different from existing financial assets. ” How would you rate your participation in DAXPO? “In addition to Regtech, which helps improve the integrity and compliance of the digital asset market, new standards for crypto assets are needed. DAXPO is an important event in which local governments and the crypto-assets industry work together, and will be a meaningful venue for constructive regulation of crypto-assets.

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6.30.2019

Congress Drew a Fine Line Between Libra and Crypto – That’s a First

Congress might actually get crypto. That was a key takeaway from last week’s contentious hearings in on Facebook’s Libra project in Washington, D.C.. While giving Facebook executive David Marcus the third degree, lawmakers took pains to distinguish between the social network’s project and the broader cryptocurrency ecosystem. Chen Arad, chief marketing officer of compliance Solidus Labs, said the way the committee appears to be handling the potential legislation was a positive sign. “I particularly appreciated Chairman Waters repeatedly admitting the committee doesn’t understand the issue well enough, and that they’re looking to learn before they can take legislative action effectively,” he said.

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6.20.2019

Trade Surveillance Market 2018-2028 Top Players- Accenture, Solidus Labs, Software AG, Cinnober, Aquis...

Research firm Future Market Insights names Solidus as one of the market surveillance industry's key players in the coming decade, alongside traditional heavyweight firms Accenture, NICE-Actimize and others.

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6.17.2019

Key Takeaways from the CryptoCompare Digital Asset Summit 2019

On Wednesday, 12 June, a crowd of 700 assembled at London’s iconic Old Billingsgate market for the CryptoCompare Digital Asset Summit. Solidus Labs' CMO, Chen Arad, and fellow panelists discussed market integrity and consumer protection.

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6.3.2019

SEC’s Crypto Savvy Surprises Blockchain Insiders at DC Forum

Chen Arad, chief marketing officer of Solidus Labs and an attendee at the forum, told CoinDesk that senior SEC staff were able to “comfortably” discuss various technical issues, including nodes, consensus mechanisms and smart contracts.

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3.15.2019

Yahoo Finance: Crypto and blockchain giants join GDF board

Solidus joins international heavyweights like Coinbase, Consensys and Circle as a Founding Member and advisory council member of Global Digital Finance.

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3.14.2019

Solidus Labs makes play for Asia with OAX partnership

OAX Foundation and Solidus Labs have today announced a strategic partnership based around the shared objective of bringing digital asset trading into the mainstream.

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2.23.2018

Goldman Sachs Veterans Raise $3 Million To Combat Market Manipulation

Solidus Labs wants its machine-learning based trade surveillance platform to work towards this cause.

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How Solidus Helps

Solidus’ Machine Learning powered surveillance and monitoring hub is designed uniquely for the challenges of digital assets and in order to make the lives of compliance teams easier. We already help crypto exchanges, broker dealers, market makers and other financial service provider reduce costs, protect their reputation and work towards compliance. Get in touch today for a product demo

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