Tokenize Xchange received full approval from the Securities Commission of Malaysia two months ago. Interestingly, apart from the Tokenize Xchange two other digital asset exchanges also received full approval from the commission. Recently, the Malaysian digital asset trading platform made an important announcement. Tokenize Xchange will be deploying cryptocurrency market surveillance tools developed by Solidus Labs.
Importantly, solutions provided by New York-based Solidus Labs will use machine learning to read thousands of factors including trading behaviors as well as market conditions that must be reviewed. Moreover, thanks to surveillance tools it will be easier to deal with wash-trading, spoofing, pump-and-dump, etc.
Tokenize Xchange and regulations
Unfortunately, there is no lack of various illegal activities connected with the digital asset industry. As a result, exchanges must improve their security systems. It means that cryptocurrency surveillance tools are important as thanks to such tools exchanges will be able to detect illegal activities.
Moreover, better regulations as well as surveillance tools to moderate crypto exchanges and trading activities will improve the situation. Tokenize Xchange will benefit from enhanced security.
It is worth noting that, Hong Kong and Malaysia already clarified that exchanges need an external market surveillance provider. Otherwise, the digital asset exchange won’t be able to receive a license.
Regulators in other countries are also working on similar frameworks. Thus, most of the countries will adopt similar requirements. Moreover, digital asset exchanges should prepare in advance as it will be harder to adapt to new requirements in a short period of time.
However, there are challenges when it comes to integrating market surveillance systems into exchanges. This is more problematic in the case of cryptocurrency exchanges.
As a result, integration is not only a very complex process but it requires serious financial capabilities. Consequently, many exchanges are not willing to invest in market surveillance tools. However, they should pay more attention to such systems.