Gibraltar has unveiled new regulations to tackle insider trading and market manipulation in the crypto industry. The British Overseas Territory published an amendment to the current laws earlier today and issued a guidance note for crypto companies operating in its jurisdiction.
According to the guidance note, Gibraltar requires crypto businesses to respect the markets in which they operate. Specifically, the Gibraltar Financial Services Commission (GFSC) instructs crypto businesses to combat the manipulation or improper influence of prices, liquidity, market information or any other practice that harms the market integrity.
Talk to CNBCGibraltar’s Digital and Financial Services Minister, Albert Isola, said:
“We were the first jurisdiction in 2018 to launch the legal and regulatory framework, and we are now the first jurisdiction to launch a framework for market integrity. The more there are in the world in terms of international standards for this space, the more trust, use and adoption will be around the world.
He added that Gibraltar’s famous history of introducing crypto-friendly rules is not a marketing plan. On the contrary, he said the jurisdiction was only looking to attract a small number of quality companies.
Market manipulation continues to plague the crypto space
This news comes as market manipulation continues to prove a difficult problem for the crypto market to solve. Apart from crypto exchanges, experts believe that crypto whales play a major role in determining the direction of the market.
GraniteShares Director of Research Ryan Giannotto has previously stated that Bitcoin (BTC) is an example of a coin susceptible to market manipulation. According to him, only about 0.02% of BTC holders control more than 40% of BTC in the market.
Data from bitinfocharts.com supports Giannotto’s claims. Currently, the top 10,000 BTC addresses control 59.16% of the flagship cryptocurrency’s supply. To put this into perspective, recent to research shows that the BTC network has more than 81 million wallets.
Besides crypto, market manipulation is also evident in the non-fungible token (NFT) space. As CryptoSlate previously reported, the wash trade is said to account for 95% of LooksRare’s trading volume.
Unlike Gibraltar, most jurisdictions struggle to regulate the crypto space. For example, the United States has yet to determine which regulators will oversee the crypto market, let alone create a regulatory framework.
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