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US SEC Increases Inspection of 'Troublesome' Crypto Auditor Work

David – Cryptocurrency Expert

  • The acting Chief Accountant of the SEC stated that they are cautioning investors to be wary of statements made by cryptocurrency exchange platforms

  • Paul Munter noted that the SEC will take a referral to the enforcement division under consideration

  • Proof-of-reserve filings don't include enough information, the SEC cautioned

The US Securities and Exchange Commission (SEC) has reportedly tightened its monitoring of cryptocurrency auditors' work for cryptocurrency businesses.

"We are telling investors to be very skeptical of some of the promises that are being made by crypto firms. If we come across fact patterns that seem troubling, we will think about referring the case to the division," said Paul Munter, acting chief accountant for the SEC, in an interview. Crypto firms have been working to regain consumers' faith since FTX's demise by utilizing their proof of reserves report demonstrating that they still hold their customers' money. As a result, cryptocurrency businesses are contacting audit companies to provide third-party guarantees to clients and investors.

The SEC stated that these proof-of-reserve reports do not give adequate information and that people who are investing in cryptocurrency should exercise caution when relying on them. Additionally, according to the SEC, some of these disclosures do not contain all the pertinent financial information because crypto businesses later claim that doing so violates confidentiality.

As investor anxiety grows, the SEC is also cautioning auditing companies that publishing crypto audit findings might harm their reputation. The auditing assertions were recently deemed untrustworthy by FTX's new CEO John Ray. Many companies, including Mazar, the author of Binance's reserves report, have halted as a result of the increasing pressure on auditors. Due to the possibility of legal action, damage to their image, and increasing regulatory scrutiny, the Big Four accounting firms are actually not prepared to audit the proof of reserves report.

Even that said, considering that most users have already taken their coin holdings and other crypto assets out of these various crypto exchange platforms, exchanges that make it through this winter market could be considered reliable. But ultimately, it seems that the major lesson from this bear market is to store your assets in wallets that do not have access to your private keys.

Store your crypto in your personal wallet and if you are looking for a regular top-up, make sure to visit BCBitcoin – a cryptocurrency broker. The website lets its registered users to buy and sell cryptocurrency and so much more.

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