Crypto.com's Hidden Trading Activities Causes Drama

Crypto(.)com, a popular digital currency platform promoted by actor Matt Damon, reportedly has its own teams trading digital tokens. This causes worries about possible unfair practices in the digital currency business.

Crypto(.)com is based in Singapore and is one of the top 10 digital currency platforms. It does trading activities that are usually done by separate parties. This is unusual because these platforms normally bring together buyers and sellers at fair prices.

U.S. regulators have started to notice this. Binance, the world's biggest digital currency exchange, was recently accused by the U.S. Securities and Exchange Commission (SEC) of unfairly increasing trade volumes through a trading firm owned by its CEO.

Gary Gensler, the Chair of the SEC, said this isn't like traditional finance, where usual exchanges do not work like investment funds.

Since starting in 2016, Crypto(.)com's in-house trading activities have mostly gone unnoticed. Reports say that officials from Crypto(.)com told outside traders that they were not doing trading activities. They also said that staff were told to deny that they had an internal department for creating markets.

But, Crypto(.)com denies any dishonesty, confirming it has an internal market-making operation, similar to outside market-makers.

The company defended what it's doing by saying most of its earnings come from its retail trader app where Crypto(.)com acts as the opposite party. Their trading team spreads these positions across several places, including their own exchange, to ensure a balance of risk.

The company's own trading team trades on its platform and others, aiming to make profits.

Crypto(.)com's market-making operation works to increase the amount of money available on its platform. The company stresses that all participants, including market makers, are treated equally and that in-house trading is not a major source of income.

Crypto(.)com, started by CEO Kris Marszalek and CFO Rafael Melo, has handled $35 billion in spot digital currency and $21 billion in digital currency derivatives this year.