Only 14% of Exchange Platforms Licensed, New Study Shows

Only 14% of Exchange Platforms Licensed, New Study Shows

According to regulatory start-up, Coinfirm, just 14% of online exchange platforms have licensing from a recommended licensing authority according to new research.

When we do anything online, it is always important to know we can trust that where we operate can be trusted. Never more so than we it comes to online funds. Hence why this latest research is so disturbing, as you may have been putting money online in places where there is no board to back it up. That is if you want to trust the latest research from the London-based firm Confirm.

They conducted research into 216 exchange platforms in the world, which represents more than 90% of all online crypto market activity. In their study of key risks, they found seven fields of concerns that users should be wary of.

Predominately the issue was the lack of licensing, however, other issues have arisen about poor KYC, Customer Due Diligence and Anti-money laundering procedures. As well as compliance, sanctions, senior public figures, jurisdiction, and negative and adverse media being inadequate.

As you can probably already tell, these are major factors in the operation that shouldn’t be overlooked. However, in terms of convenience, further issues were raised about how many incorporate a fiat to crypto service. In their research, they discovered just 40% of exchange platforms support this service. While of the remaining 60%, less than a quarter had a full KYC process in place that supported deposits and withdrawals for crypto and fiat currency transactions.

What’s more, the level of composite risk in different countries can vary greatly. With the US and UK at a medium level of risk and Russia and Iran at a high level of risk.

Be careful who you trust out there investors!

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