As we put our foot on the gas pedal in 2020, we thought it would be useful for us to take a quick trip down memory lane, or to put it more specifically, Audit Lane. As the first federally regulated cryptocurrency derivatives exchange, we believe that full cooperation with regulators isn’t just a requirement we have to follow; it’s central to our commitment to our customers. In order to keep this commitment, in the last few years, we have undergone a battery of rigorous independent audits in our New York HQ covering our financial position, anti-money laundering / know-your-customer (AML/KYC) processes, cybersecurity systems and, last but not least, internal control mechanisms.
In total, industry leaders like Ernst & Young, Grant Thorton, Praetorian and Friedman LLP conducted audits, which we passed without any qualifications (See the recap of those audits below).
As 2020 rolls along, we know that there will be periods of time in which crypto’s early adopters will bang the drum of full decentralization. We also expect to see a few prominent members of the old guard financial community maintain their negative stance on bitcoin, as some continue to view it as a threat to fiat currencies. That’s okay. We believe there is a growing contingent of savvy bitcoin enthusiasts who know that the noise coming from opposing voices creates interesting opportunities. And for those who know how to deploy bitcoin options, those opportunities for either responsible speculation and/or intelligent risk mitigation are aplenty. So as we introduce new and improved offerings this year, our customers can trust that LedgerX will be operating according to the highest standards possible — leaving our customers free to focus on what’s most important: trading.
- Glenn Chaleff
- Anti Money Laundering (AML): Ernst & Young staff conducted a full analysis and review of our OFAC (Office of Foreign Assets Control) procedures and AML processes, strategy, policy, controls and related technologies.
- Financial Condition: Grant Thorton audited LedgerX’s financial condition and expressed an unqualified opinion (i.e., clean bill of health) that our financial statements were presented fairly, in all material respects, in accordance with US GAAP accounting principles.
- Digital Currency: Because we custody bitcoin on behalf of our clients, Grant Thorton conducted a thorough examination of how we hold digital assets.
- Security: Praetorian, a trusted name in cybersecurity, performed an Information Technology (IT) Security Risk Assessment that evaluated the effectiveness of LedgerX’s existing security controls.
- Internal Controls: Friedman LLP, a well known auditor in digital currency accounting, conducted an audit of our internal controls (technically known as a SOC I Type II Audit) to ensure that they are operating effectively and appropriately protecting client data.
- Onsite IT systems: Every year, the CFTC examines one aspect of our operations with a special emphasis. Last year, this examination covered our onsite systems and safeguards.