We receive and publish the following insights from the Ushare blog team regarding Consob, highly useful for those acting as brokers and investigating risks associated with Bitcoin exchanges. The Securities and Exchange Commission (SEC), the American equivalent of Consob, is significantly stepping up controls. In a matter of days, it has sued two giants, Binance and Coinbase.

The accusations in these cases are different. Regarding Coinbase, the company was accused of acting as an unregistered broker and trading platform. For Binance, however, the situation appears to be much more serious, as it has been accused of mishandling customer funds and lying to regulators and investors about its operations.

Risks of keeping Bitcoin on Binance and Coinbase

If an investor decides to keep their Bitcoin within Binance or Coinbase, as highlighted by Daniele Marinelli, CEO of DTSocialize Holding, they probably think of Bitcoin solely as a speculative asset for trading. According to recent analyses by SDA Bocconi, the highest percentage of investors is primarily attracted to speculation and does not consider the underlying ideological and technological aspects. Unfortunately, this leads investors to trust intermediaries like Coinbase or other less reliable platforms when trying to safeguard and defend their assets.

SEC’s request to Binance

Returning to the accusations made by the Securities and Exchange Commission, Daniele Marinelli (Ushare social profit marketing) stated that US authorities have requested the freezing, at least for the time being, of all assets held by Binance in the United States. This motion is motivated by the need to ensure the security of customer assets. Reading the court documents reveals the accusations against Binance, which allegedly “mixed” billions of dollars of funds belonging to customers, then secretly sent them to an account of the founder Changpeng Zhao.

According to the SEC, the company consciously chose to circumvent the rules, thereby putting its customers in difficulty in an attempt to maximize profits. From the top ranks of Binance, they claim that the accusation is unfounded, and the company cannot be considered a US exchange, limiting the Securities and Exchange Commission’s action.

Legal action against Coinbase

The legal action filed against Coinbase is 101 pages long, where it is accused of evading rules for years, allowing about 13 assets to be traded without being registered. Brian Armstrong, the CEO of Coinbase, stated that “the SEC’s approach harms America,” emphasizing that the platform has repeatedly tried to register but there is no way to do so.

Regarding the new Consob seminar

Consob has recently organized a seminar on digital finance and how cryptocurrencies are impacting investments in Italy. The meeting revealed very interesting insights, outlining the “profile” of cryptocurrency investors.

Profile of retail Crypto investors

Male, young, overly self-assured, and a lover of the digital nature of financial markets. This is the profile of retail crypto investors developed during the seminar on digital finance and the world where cryptocurrencies affect investments. In fact, according to recent statistics, 84% of people interested in cryptocurrencies are male, and of these, 74% show less aversion to risk. 34%, in fact, do not express concern about potential losses. This personality can be attributed to the fact that, in most cases, these are young investors who often do not yet have the need to manage family responsibilities, which is why they tend to act more boldly.

Watch out for overconfidence

It must be emphasized, however, that from the extrapolated results, 35% of investors exhibit overconfidence in their abilities, considered excessive. Essentially, there is a perception of overestimated financial knowledge. In fact, according to the data, cryptocurrency investors have poor financial knowledge globally (31% compared to 53% of those not interested) and also in terms of digital security (40% compared to 52% of those not interested). Normally, also, only 19% of these investors tend to use financial advisory services, unlike the 43% who show no interest. 36% of cryptocurrency investors tend to save regularly, a slightly lower rate than the 44% who are not interested in this type of investment.

Trader’s profile

In addition to the profile of cryptocurrency investors, Consob has analyzed the profile of individuals interested in online trading. Traders are much more informed about all financial products and digital security. 81% of respondents have shown a rather high level of familiarity with digital finance, but they are less inclined to do-it-yourself finance and more prone to financial advice (32% compared to 39% of those not interested). Finally, 40% of respondents adopt regular savings, proving to be “less diligent” compared to the 44% who are not involved in online trading.