Poloniex offers trading in Bitcoin cash (BCH) fork tokens, SEC moves against EtherDelta to send crypto lower

securities and exchange commission

Poloniex has jumped the gun and got one over on its competitor exchanges by allowing its clients to start trading Bitcoin Cash ABC (BCHABC) and Bitcoin Cash SV (BCHSV) tokens.

A statement from the exchange on the BCH situation in part reads: “We’re doing this to empower customers to demonstrate their support for one coin over the other through trading activity. Poloniex will also support trading markets for both tokens after the hard fork.”

If early trading is anything to go by then it looks like BCHSV will be the loser.

Perhaps that’s why Roger Ver is distancing himself from Craig Wright’s BCHSV . He now says  he may have been fooled by Wright. Many in the community will be saying a loud “We told you so!”

Here’s the video of Ver on the Bitcoin Cash mess:

The level of vitriol and pettiness surrounding the upcoming fork is not doing the reputation of the industry much good at all. The forking also leads to confusion in the marketplace for consumers and provides an opening for scammers.

BTCUSD 1-hour chart

The crypto market saw some of its value shaved off yesterday. BTC is off 1.5% at $6352, having fallen below all three key moving averages (50 [green], 100 [blue], 200 [red] MAs).

SEC enforces action EtherDelta DEX

The pullback is being blamed on the emergence of the news yesterday that the US Securities and Exchange Commission (SEC) has taken enforcement action against decentralised exchange (DEX) EtherDelta.

Others partly blame the strengthening US dollar for the price falls, given that is currently the most popular fiat base trading currency.

Explaining the decision, Stephanie Avakian, co-director of the enforcement division, said: “EtherDelta had both the user interface and underlying functionality of an online national securities exchange and was required to register with the SEC or qualify for an exemption.”

The SEC claims that over 18-months the exchange “executed more than 3.6 million orders for ERC20 tokens, including tokens that are securities under the federal securities laws”.

EtherDelta founder Zachary Coburn has complied with the enforcement action “without admitting or denying the findings”, and paid a fine totalling nearly $400,000.

An SEC press statement stated: “Without admitting or denying the findings, Coburn consented to the order and agreed to pay $300,000 in disgorgement plus $13,000 in prejudgment interest and a $75,000 penalty. The Commission’s order recognizes Coburn’s cooperation, which the Commission considered in determining not to impose a greater penalty.”

The implications of the SEC action is that all DEX’s will be in the same position. The SEC has become more proactive in the crypto space by going after initial coin offering promoters and now exchanges, it sees as either selling securities or providing venues for the trading of them.

The SEC uses the Howey Test to determine whether a token is a security. It has not made a definitive ruling as yet but in its actions and statements it is in practice determining that pretty much all tokens are securities with the exception of bitcoin and Ethereum (but not the ERC-20 and other tokens based upon it).

About the Author

Gary McFarlane
Gary has been writing about cryptocurrencies since 2013 and currently works as the cryptocurrency analyst at interactive investor, the UK's second-largest online investment platform. Gary contributes for Coin Intelligence News in a personal capacity and none of his commentary should be considered investment advice. Gary is the winner of the ADVFN International Financial Awards 2018 Cryptocurrency Writer of the Year. Contact Gary on twitter at: @gary_mcfarlane

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