Assets Under Management

Assets under management refer to the total value held in crypto assets belonging to users by companies at that particular time. This helps companies maintain transparency and decentralization, which are at the core of what blockchain offers over traditional internet techniques. Although various players in the cryptocurrency space opt to limit the extent of decentralization in their projects, transparency is of utmost importance. However, as with many disruptive technologies, certain players exploit a lack of accountability in crypto asset management. In recent times, many companies collapsed due to financial difficulties, but there was hardly any transparency about their transactions. Fair reporting of assets under management could help investors gauge their choices better.

Transparency In Reporting Assets Under Management

That companies involved in blockchain are not being transparent itself is a huge discrepancy. The lack of transparency over crypto marketing firms getting liquidated in recent times certainly bothered individual crypto traders.

Companies like Celsius and Voyager suddenly suspended withdrawals citing a liquidity crunch. The lack of transparency in reporting assets under management and collateralizing assets loaned out or received led to devastating effects. It ultimately resulted in a massive drop in Bitcoin and Ethereum prices. It also resulted in increased regulatory pressure on the crypto ecosystem.

In a recent case of alleged fraudulent activity, the U.S. SEC charged three people in the first ever crypto insider trading scheme. The Securities and Exchange Commission charged a former Coinbase product manager for allegedly perpetrating the scheme. In its shocking complaint, it alleged that the Coinbase employee revealed vital information to his close ones before making them public.

Crypto Financial Reporting – The Need To Improve

It is often argued that firms involved in cryptocurrencies could be transparent about their assets under management and operations. A vital aspect of this issue is companies’ financial statement reporting.

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About author
Disclaimer

Anvesh reports major crypto updates around U.S. regulation and market moving trends. Published over 1400 articles so far on crypto and blockchain. A proud dropout of University of Massachusetts, Lowell. Can be reached at [email protected] or x.com/BitcoinReddy or linkedin.com/in/anveshreddybtc/

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

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