Cryptocurrency exchanges form self-regulatory group

Cryptocurrency exchanges form self-regulatory group
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Cryptocurrency exchanges are forming their own group to help self-regulate their growing industry.

The Virtual Commodity Association, announced Monday, includes companies Bitstamp, bitFlyer USA, Bittrex, and Gemini, which was founded by the Winkevoss twins.

It is set to hold its first meeting in September.

The companies touted the formation of their new group as a step toward improving regulation of cryptocurrency amid criticism that regulators have been too lax.

“This is the first of many steps in policing the digital asset markets and answering the call of regulators,” Yusuf Hussain, Gemini’s head of risk, said in a statement.

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But the moves to better police their own industry will also be seen by cryptocurrency watchers as an effort to stave off tougher rules from regulators.

In recent months, agencies that regulate cryptocurrencies, including the Securities and Exchange Commission and the Commodities Futures Trading Commission, have warned of stepping up their enforcement.

SEC Chairman Jay Clayton has been especially vocal about cracking down on bad actors manipulating initial coin offerings and other types of cryptocurrency operations he fears are defrauding investors and skirting securities laws.

Hailey Lennon, bitFlyer USA's director of compliance, said in a statement that she believes cryptocurrency companies should be a part of the debate on regulation.

“Industry leaders with extensive knowledge and who are impacted by regulations should really be part of the conversation," said Lennon.