Crypto firm claiming $1.4B in trades on CMC flashes reportedly fake license data
A number of cryptocurrency platforms reporting billions of dollars in daily trades on CoinMarketCap appear to have been misleading their customers about holding certain crypto licenses, an investigation by Cointelegraph has found.
Bitspay, a crypto exchange that reports a $1.4 billion daily trading volume on CoinMarketCap, claimed it held a license in Estonia, and is regulated under Estonian law. However, after Cointelegraph reached out with questions about this license, the company swiftly erased its reportedly fake license data.
At the time of writing, Bitspay is the fourth-largest crypto exchange by daily trading volume on CoinMarketCap, following platforms like Binance, BitForex and Topcredit International.
According to Bitspay’s page on CoinMarketCap, it is a centralized exchange (CEX) based in Estonia. The exchange was launched in 2020 and claims to be regulated under the Estonian “Anti Money Laundering Counter-Terrorism Financing Act 2019,” which appears to be referring to the country’s Money Laundering and Terrorist Financing Prevention Act.
Bitspay also claimed it was licensed and regulated by Estonia’s Financial Intelligence Unit (FIU). “Bitspay Limited registered with the registration number FVR000796, under the Laws of the Republic of Estonia,” the firm stated on one of its domains, Bitspay.io, until it erased the information immediately following Cointelegraph’s inquiries.
Contacted by Cointelegraph, Estonia’s FIU reported that Bitspay didn’t hold any valid license in Estonia. “We took a look into it, and it seems that the license number which they have previously announced refers to an Estonian company, Globe Assets OÜ,” a spokesperson for the FIU said in a statement on Sept. 21. The license was also valid for less than a year, from March 2019 until January 2020, the representative noted.
The FIU didn’t respond to additional questions about Bitspay’s legal status in Estonia.
Bitspay was showing its website visitors information on the license mentioned above until at least Sept. 18, 2023. The firm subsequently rebranded its website from the briefly unavailable Bitspay.io to Bitspay.global on Sept. 21, removing all data about being registered or regulated in Estonia.
At the time of writing, Bitspay has not provided any information about its registration or license status on its new website. The exchange also claims on its website that its daily trading volume amounts to 65,249 Bitcoin (BTC), or $1.7 billion. However, the exchange appears only to have around 400 followers on X (formerly Twitter) and some 16,000 members on its Telegram channel.
Kelly Nova, who is said to be the founder and CEO of Bitspay, told Cointelegraph that the exchange is working on licenses in both Estonia and the United Kingdom. “We have some copyright issues, and that’s why we closed the Bitspay.io domain,” he said. The exec didn’t respond to Cointelegraph’s request for further information about Bitspay founders or why the firm previously claimed to have a license in Estonia on its website.
Bitspay appears to be far from the only platform reporting massive trading volumes on CoinMarketCap despite little being known about its licenses, founders or background. Exchanges like Topcredit, which reports $1.8 billion in daily trading volume on CoinMarketCap, and Bika, which reports $1.2 billion, have been unwilling to talk to Cointelegraph about their background and founders.
“We have long been aware that self-reported data can be problematic, but APIs are the only viable source for data collection,” a spokesperson for CoinMarketCap told Cointelegraph.
The representative also referred to the website’s scoring system, pointing out that platforms like Bitspay, Topcredit or Bika have a significantly lower score than major exchanges like Binance, which has owned CoinMarketCap since April 2020. “We always encourage our users to perform their own due diligence, especially with low-scoring exchanges,” the spokesperson said, adding:
“We know our data isn’t infallible. Our role is as an objective and comprehensive information aggregator, not a regulator. […] In short, CMC numbers are as credible as they can be, using our industry leading experience, technology, verification methodology and feedback loops […]”
The spokesperson cited the crypto adage “don’t trust, verify” and said it embodies a foundational principle of cryptocurrencies and blockchain technology.
Related: Hong Kong to list ‘suspicious’ crypto platforms in wake of JPEX scandal
According to a public announcement, Bitspay was listed on CoinMarketCap in July 2023. CoinMarketCap’s primary rival, CoinGecko, hasn’t listed this website, nor has it listed Topcredit or Bika. Despite this discrepancy, CoinGecko has significantly more spot exchanges listed than CoinMarketCap. At the time of writing, CoinGecko lists a total of 784 exchanges, while CoinMarketCap lists only 225.
Websites like CoinMarketCap have frequently been criticized for providing inflated exchange trading volumes. In 2019, Bitwise Asset Management claimed that 95% of volumes on unregulated exchanges reported on CoinMarketCap were fake or non-economic wash trading in nature. Another investigation by data analytics firm The TIE suggested in 2019 that more than 86% of reported crypto trading volume appeared suspicious.
Thousands of job cuts at the NHS will go ahead after the £1bn needed to fund the redundancies was approved by the Treasury.
The government had already announced its intention to slash the headcount across both NHS England and the Department of Health by around 18,000 administrative staff and managers, including on local health boards.
The move is designed to remove “unnecessary bureaucracy” and raise £1bn a year by the end of the parliament to improve services for patients by freeing up more cash for operations.
NHS England, the Department of Health and Social Care, and the Treasury had been in talks over how to pay for the £1bn one-off bill for redundancies.
It is understood the Treasury has not granted additional funding for the departures over and above the NHS’s current cash settlement, but the NHS will be permitted to overspend its budget this year to pay for redundancies, recouping the costs further down the line.
‘Every penny will be spent wisely’
Chancellor Rachel Reeves is set to make further announcements regarding the health service in the budget on 26 November.
And addressing the NHS providers’ annual conference in Manchester today, Mr Streeting is expected to say the government will be “protecting investment in the NHS”.
He will add: “I want to reassure taxpayers that every penny they are being asked to pay will be spent wisely.
“Our investment to offer more services at evenings and weekends, arm staff with modern technology, and improving staff retention is working.
“At the same time, cuts to wasteful spending on things like recruitment agencies saw productivity grow by 2.4% in the most recent figures – we are getting better bang for our buck.”
Health Secretary Wes Streeting during a visit to the NHS National Operations Centre in London earlier this year. Pic: PA
Mr Streeting’s speech is due to be given just hours after he became entrenched in rumours of a possible coup attempt against Sir Keir Starmer, whose poll ratings have plummeted ahead of what’s set to be a tough budget.
Mr Streeting’s spokesperson was forced to deny he was doing anything other than concentrating on the health service.
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He is also expected on Wednesday to give NHS leaders the go-ahead for a 50% cut to headcounts in Integrated Care Boards, which plan health services for specific regions.
They have been tasked with transforming the NHS into a neighbourhood health service – as set down in the government’s long-term plans for the NHS.
Those include abolishing NHS England, which will be brought back into the health department within two years.
Watch Wes Streeting on Mornings With Ridge And Frost from 7am on Sky News.
Arjun Sethi, the co-CEO of major crypto exchange Kraken, criticized the United Kingdom’s crypto regulations, which he believes hinder services for their customers.
In an interview with the Financial Times, Sethi said that “in the UK today, if you go to any crypto website, including Kraken’s, you see the equivalent to a cigarette box.” He suggested that the disclaimers have a significant impact on customer experience.
Sethi suggested that disclosures slow users down and that, because of the importance of speed in crypto trading, “it’s worse for customers.” He concluded that “disclosures are important […] but if there are 14 steps, it’s worse.”
The UK Financial Conduct Authority’s (FCA) updated financial promotion regime came into force in October 2023. It introduced a “cooling-off” period for first-time crypto investors and requires firms to assess whether users have sufficient knowledge and experience before trading.
Sethi said that the rules may prompt customers to avoid investing in crypto altogether, potentially leading to missed potential gains. The FCA defended the rules, noting that “some consumers may make an informed decision that investing in crypto is not right for them — that is our rules working as intended.”
Related: ClearToken gets FCA nod for crypto settlement platform amid UK rules push
The UK is slowly opening to crypto
Despite frustrations with the FCA, the UK appears to be moving toward a broader alignment with the United States on digital-asset oversight.
Lisa Cameron, a former United Kingdom Member of Parliament and founder of the UK-US Crypto Alliance, said she believes a joint “sandbox” between the UK and the US is in development to align their crypto markets.
She came to this conclusion after discussion with US Senators and regulators and expects the sandbox’s purpose to be to “iron out some of this in terms of passporting” for crypto licenses between the UK and the US.
On Monday, the Bank of England published a consultation paper proposing a regulatory framework for stablecoins. The new legislation is focused on sterling-denominated “systemic stablecoins” widely used in payments, similar to the US’s GENIUS Act.
Related: British crypto firm KR1 eyes London Stock Exchange as UK warms to industry: FT
UK looks to the US for an example on crypto
A crypto collaboration between the UK and the US is not a new phenomenon. September reports noted that treasury authorities in the US and UK created a transatlantic task force to explore “short-to-medium term collaboration on digital assets.” Also in September, UK Chancellor Rachel Reeves and US Treasury Secretary Scott Bessent discussed how the two nations could strengthen their coordination on crypto.
September also saw UK trade groups urge the UK government to include blockchain technology in a technology collaboration with the US program known as “Tech Bridge.” A joint letter by the organization warned that “excluding digital assets from the UK-US Tech Bridge would be a missed opportunity,” and that it “risks leaving Britain on the sidelines.”
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