From Investing.com: 2024-04-10 11:12:06

The European Securities and Markets Authority (ESMA) warns of risks in crypto trading due to high concentration among a few exchanges, notably Binance accounting for over 50% of the market. The EU is implementing strict regulations for trading cryptoassets like bitcoin and Ether.

Trading volumes show 10 exchanges processing 90% of trades, with Binance dominating the market. ESMA raises concerns about potential implications of a major exchange failure on the wider crypto ecosystem. Binance emphasizes commitment to healthy growth and compliance processes in light of regulatory uncertainty.

While bitcoin hit a record high in March, the entire cryptocurrency market’s value is just $2.7 trillion, a small fraction of the global financial system. ESMA finds challenges in identifying order flow origins and the locations of crypto exchanges, with most trading occurring outside the EU in tax havens.

ESMA discredits the idea of crypto assets being a safe haven during market turmoil, noting their correlation with equities and lack of stability with gold. To further discuss their findings, ESMA will host a webinar on April 25.

Read more at Investing.com: Crypto trading concentration a ‘considerable concern’, EU watchdog says By Reuters