What disclosures must a crypto exchange provide?
No single US crypto exchange disclosure form exists. What an exchange must provide depends on its SEC, CFTC, FinCEN and state licenses. More rules apply.
Vahe HakobyanEditor-in-chief
Updated Oct 6, 20263 min readFact-checked
On this page
- SEC rules cover fees, order handling and conflicts.
- CFTC rules require a risk statement before futures trading.
- Custody and segregation rules affect customer protection.
- The IRS requires broker reporting for crypto sales.
US crypto exchanges do not all face the same disclosure rules. The rules follow the licenses a platform holds and the activities it offers.
Is there one required disclosure?
No. A platform can be registered for one activity and unregistered for another. The duties attach to the license, not to the brand on the app.
What must securities exchanges disclose?
A platform that trades securities falls under SEC rules. It must disclose how it handles customer orders and conflicts of interest that may affect those orders.
What about futures and derivatives?
Futures and derivatives fall under CFTC rules. A platform that offers them must give you a risk disclosure statement before you trade. That statement explains the risks of leveraged products.
- Margin and liquidation terms
- How customer funds are held
- Whether the platform is registered with the CFTC
- How to close a position
How do money transmitter rules apply?
An exchange that transmits money usually must register with FinCEN as a money services business. It also needs a license in most states. Operating without a license has been a state banking felony.
What custody and tax disclosures matter?
An exchange should disclose who holds customer crypto, whether customer assets are kept apart from company funds, and what insurance covers. A failed exchange can leave customers as general creditors. The IRS treats crypto as property, so a sale can be taxable.
The IRS requires brokers to report digital asset sales on a special form. That reporting applies to recent tax years under an IRS rule.
Frequently asked questions
No federal rule requires proof of reserves. A published attestation is not a full audit of customer assets.
Ask support in writing for its risk documents and fee schedule. If it refuses, complain to the regulator named in its licenses.
US rules rarely require it. Policies often cover narrow losses, such as a hack, and may not cover market losses or all assets.
Brokers send the form after the tax year ends, often in the following winter.
