Execs of Crypto Exchange Coinsquare Resign Over Market Manipulation Accusations
The senior executives of Canada’s biggest cryptocurrency exchange Coinsquare have conceded to the request from the Ontario Securities Commission (OSC) to resign, after being charged with falsifying trade volumes.
The platform admitted conducting 840,000 illicit transactions to the aggregate amount of 590,000 BTC, as well as the fact that the top management knowingly incentivized employees to feign trading.
The exchange also admitted that it had taken a reprisal against an employee who wanted to report the illicit activity to authorities.
Coinsquare CEO Cole Diamond, founder Virgile Rostand, and manager Felix Mazer are now obliged to step down from their positions, with Diamond to pay a $1 million fine and Rostand to pay $900,000. On top of that, they are officially banned from any operations involving cryptocurrencies for three years.
Mazer has already paid a $50,000 fine. He won’t be able to be a market participant for one year.
The regulator recommended that the exchange revises its management model and introduces a whistleblower support program.
Initially, the OSC accused Coinsquare of inflating its trade volumes by 600,000 BTC. According to the regulator, 90% of the trade volume at the exchange was created artificially in an illegal practice known as wash trading, or a strategy where the same person acts as both the seller and the buyer, over the period from July 17, 2018, to December 4, 2019.
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