Several cryptocurrency platforms, featured on CoinMarketCap as conducting billions of dollars in daily trades, have come under scrutiny for allegedly misleading their customers about possessing certain crypto licenses. An investigation conducted by Cointelegraph has uncovered these discrepancies.
Bitspay, a cryptocurrency exchange with a reported daily trading volume of $1.4 billion on CoinMarketCap, had claimed to hold a license in Estonia and operate under Estonian regulations.
However, upon questioning by Cointelegraph regarding this license, Bitspay promptly removed the allegedly fake license data.
As of now, Bitspay ranks as the fourth-largest crypto exchange by daily trading volume on CoinMarketCap, trailing behind platforms like Binance, BitForex, and Topcredit International.
Bitspay, according to its CoinMarketCap page, identifies itself as a centralized exchange (CEX) located in Estonia, having been launched in 2020. It purports to be regulated under Estonia’s “Anti Money Laundering Counter-Terrorism Financing Act 2019,” which is likely a reference to the country’s Money Laundering and Terrorist Financing Prevention Act.
Bitspay also claimed to be licensed and regulated by Estonia’s Financial Intelligence Unit (FIU). However, Estonia’s FIU revealed that Bitspay did not possess a valid license in Estonia.
The spokesperson for the FIU disclosed that the license number previously announced by Bitspay belonged to another Estonian company, Globe Assets OÜ, and was valid for less than a year, from March 2019 to January 2020.
Bitspay continued to display information about the license until at least September 18, 2023. Subsequently, on September 21, the company rebranded its website from Bitspay.io to Bitspay.global, removing all references to being registered or regulated in Estonia.
The new website does not provide any information regarding its registration or license status.
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Kelly Nova, claimed to be the founder and CEO of Bitspay, mentioned that the exchange is in the process of obtaining licenses in both Estonia and the United Kingdom, citing copyright issues as the reason for closing the Bitspay.io domain.
However, no further information was provided about the founders or why the company previously claimed to have an Estonian license.
Bitspay is not the only platform on CoinMarketCap reporting massive trading volumes while providing limited information about its licenses, founders, or background. Other exchanges, including Topcredit and Bika, also report substantial daily trading volumes but have been unwilling to share details about their history or founders.
CoinMarketCap, acknowledging the potential issues with self-reported data, stated that APIs are their primary source for data collection.
They also highlighted their website’s scoring system, which rates platforms like Bitspay, Topcredit, or Bika lower than major exchanges like Binance, which has owned CoinMarketCap since April 2020.
CoinMarketCap encouraged users to conduct their own due diligence and emphasized their role as an objective information aggregator rather than a regulator.
The controversy surrounding platforms like Bitspay raises questions about the reliability of exchange trading volumes reported on websites like CoinMarketCap, with past investigations suggesting that a significant portion of these volumes may be fake or non-economic wash trading.
CoinGecko, a competitor to CoinMarketCap, has not listed Bitspay, Topcredit, or Bika, but boasts a more extensive list of spot exchanges. This situation underscores the ongoing challenge of accurately assessing trading volumes in the cryptocurrency market.
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