The world of Crypto is growing massively with the biggest exchanges investing millions of dollars in technology, marketing, security also with a great ecosystem to gain more customers to use their services and increase their userbase.
Coinsquare, a Canadian exchange involved with "wash trading" have been charged by Ontario Securities commission (OSC), after they admitted the illegal activity. The settlement by Ontario Securities commission involves charges to executives from the Cryptocurrency exchange and The CEO, well also the President of the firm agreed to resign their positions.
The settlement also led the executives to pay penalties in a total of $1.9 million ($1 million to one and $900,000 to another), the Duo also got banned for acting on the crypto space neither as registrants or Directors for three years. The OSC extended their actions to the Coinsquare's Chief compliance officer with same penalties like the executives of the crypto company, but he will pay $50,000 as penalty and stay out from Crypto scenario for a year.
The Charges extends additionally to make the two executives pay for the whole investigation costs conducted with $300,000 respectively as announced by Ontario Securities Commission.
What is wash trading and a little more about Coinsquare activity.
Coinsquare is a Canadian exchange dedicated to traders of Crypto assets, founded in 2014 raising more than $40 million in funding to date. The report of wash trading was placed after leaked emails were published by Vice's motherboard which led the Canadian Authorities to investigate the claim and they now settled charges.
Wash trading practice is actually automates market manipulation only to lure investors to believe in the volume produced by the exchange, meaning the firm use exchange accounts to trade between them only with purpose to impersonate users, the volume is fake and don't bring nothing to the market of assets and is illegal and punished by law.
Coinsquare have been doing that practice since 2018, the fake volume continued to 2019 and after admit the activity the regulators get known that 840,000 wash trades was done with more than $5.5 billions in dubious volume registered, that is a 590,000 BTC in fake transactions by the exchange.
This is actually the First major example of an exchange admitting wash trading practice, with many others on deck doing the same on the market, but because regulators haven't discovered or still need further investigation continue with that illegal activity.
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**header image from pixabay with no copyright infringement with rights for commercial use.
Find also the article on READ.CASH from my authorship.
