Winklevoss Twins, Nasdaq Partner on Surveillance System to Keep Bad Actors Out of Crypto Space

Sick of bad actors manipulating the crypto space Gemini is partnering with the Nasdaq to use a cutting-edge surveillance system to keep an eye on things.

If you’ve been waiting for something, anything, to make cryptocurrency investing more palatable, the Winklevoss twins have made a move that could do just that.

Their Gemini Bitcoin Exchange is working with Nasdaq Inc. to shore up systems so that users don’t become victims of market manipulators.

Cameron and Tyler Winklevoss announced partnership with the Nasdaq in a blog post Wednesday.

We highlight some of the key points here.

Being smart

At the core of the arrangement is a surveillance system called SMARTS Market Surveillance.

On its site, Nasdaq calls the system the industry benchmark for real-time and T1 solutions for market surveillance, supervision and compliance.

 

In the Gemini blog post about the partnership, the following is stated:

Building a rules-based marketplace is critical to our mission to build the future of money — individuals and institutions need to feel safe and secure when trading. To that end, we are excited to announce that over the coming months we will be implementing Nasdaq’s SMARTS Market Surveillance technology to monitor our marketplace.

It’s thought that the system will enable Gemini to monitor activity across all its trading pairs, including BTC/USD, ETH/USD and ETH/BTC. Also, according to the post, SMARTS will surveil the exchange’s newly launched Gemini Block Trading™, as well as Gemini Auctions™. Gemini

Auctions is used to determine the settlement price for the Bitcoin (USD) Futures Contracts that trade on Cboe’s CFE Exchange under the ticker symbol “XBT”.

Market manipulation

Most in the crypto space know how the actions of bad actors have led to the poor perceptions about the space.

We told you in March about an official from the U.S. Securities and Exchange Commission airing concerns about manipulation in the cryptocurrency market. Then we reported the SEC trading division head Brett Redfearn saying:

“We are concerned about a lot of the issues around manipulation, whether it’s spoofing, or any other forms of market manipulation that are out there. Spoofing, front running, wash trading, pump-and-dump, insider trading — there’s a question of, how are they being watched out for?”

Recognizing these issues also are those who operate the exchanges, such as the Winklevoss twins.

Cameron Winklevoss, president and co-founder of Gemini, reportedly said in an interview:

“We’re doing this because we believe in the importance of creating a rules-based marketplace. We believe this is where things are headed.”

One of the most recent allegations over crypto market manipulation relates to Bitcoin Cash. Observers have weighed in to say that it recent price soar is due to market manipulation.

About manipulation, it is stated in the blog post:

We believe that it is this advanced functionality combined with Nasdaq’s proven, rule-based approach to traditional financial market surveillance that will allow for the most thorough monitoring of the evolving crypto-asset marketplace, today and into the future.

Ongoing effort

Gemini has been diligent in its efforts to build a rules-based marketplace. It already includes an:

  • Information Sharing Agreement with Cboe Exchange, Inc. allowing for cross-market surveillance
  • internal Trading Policy with respect to material nonpublic information, and
  • Marketplace Conduct Rules that apply to all trading on our marketplace.
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The aforementioned blog post states:

Our market surveillance team looks forward to using Nasdaq’s Alerts Development Environment and Alerts Management System to become a market leader in custom surveillance rule creation and alerting for the crypto-asset market.

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