Bitcoin value plunge

If a trading platform lets people buy and sell cryptocurrencies that are considered securities — basically, something you can invest in — then theymust register with the SEC as an exchange, the SEC said Wednesday. That registration means regulation thats designed to protect consumers.

Bitcoin value plunged after the SEC warned of regulatory scrutiny of virtual currency marketplaces billing themselves as exchanges.

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The news drove down prices of the granddaddy of cryptocurrencies, bitcoin, as well as several others, according to prices tracked byCoinMarketCap. Bitcoin, Bitcoin Cash and Ethereum dropped 9 percent over the last 24 hours, while Ripple and Litecoin dropped 8 percent.

The SEC also has taken several enforcement actions against various cryptocurrency outfits it labeled frauds, and reportedly has broadly issued subpoenas and requests for information from many other cryptocurrency-related companies.

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Cryptocurrencies have been embraced by crypto-anarchists and others leery of centralized financial authorities and powers. But the SECs move is the newest sign that cryptocurrencies and related fundraising techniques called initial coin offerings (ICOs) are becoming less Wild West and more business as usual.

The SEC staff has concerns that many online trading platforms appear to investors asSEC-registered and regulated marketplaceswhen they are not, the SEC said. If youre running one, get your lawyer on the phone, the SEC said, because SEC staff are focusing on your operations.

Virtual currencies may be a bold new technology frontier, but marketplaces where you can buy and sell them arent exempt from regulation.

For unregulated cryptocurrency exchanges, the SEC warned of shenanigans that can take traders by surprise: Theres no guarantee they vet the assets that can be traded, set bidding and asking prices with integrity or use good trading technology.

Bitcoinand other cryptocurrencies plunged in value Wednesday after the US Securities and Exchange Commission warned of potentially unlawful exchanges where you can buy and sell the virtual currencies.

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