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Coinsquare CEO accused of orchestrating laundry business

June 14, 2020

In the last blow too Coinsquare, the competitive Canadian cryptocurrency exchange, accuses the General manager of the platform for organizing a money laundering plan in clear violation of the Securities Act.

The “Laundry trade“refers to when a stock exchange that artificially inflates its transaction volume by executing large market transactions at no cost to your own orders, Create the appearance of a great business without an asset changing hands. This practice is illegal in traditional asset markets due to its tendency to manipulate prices.

The allegations against Coinsquare were reported by Vice on June 13 when the publication claimed to have received them Filtered emails, Slack messages and other files burden the CEO of the exchangeCole diamond.

Coinsquare CEO accused of orchestrating laundry businessCoinsquare CEO accused of orchestrating laundry business

The allegations follow reports of a major data hack that saw more than 5,000 email addresses of customers at risk of SIM swap attacks earlier this month.

Coinsquare is accused of falsifying the volume

A March 2019 email exchange reportedly reportedly described an incident in which An employee was disciplined for disabling the code that fueled internal activities because I don’t “want to try that [Comisión de Valores de Ontario] CSO “with practice.

Cole’s answer was that The individual did not take into account the “immense change” in public perception of the platform’s liquidity This could result from the attitude of the laundry trade and add: “Turn it on again.”

The correspondence also states: “Cole’s decision to continue the laundry business was final“and the documents also described efforts by senior Coinsquare officials to prevent the use of the term” wash traading “in digital communications due to paper tracking concerns.

The trading volume of Coinsquare has been suspected since at least 2018when several Reddit users started speculating that much of the stock market volume could be fake.

Money laundering allegations track crypto exchange

Since the discovery of Mt. Gox Willybot in 2014, the accusations of laundering have been consistently raised against crypto exchanges.

This was estimated in a report last year Up to 95% of the quantities reported to the popular market data aggregator CoinMarketCap can be the result of the laundry trade.

Since the acquisition by the major Binance exchange in April, a number of measures have been introduced to limit the impact of fraudulent amounts on CoinMarketCap.

However, The platform has come under fire because of its new metrics that seem to strongly favor Binance.

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