Cryptocurrency industry has seen a steady growth over the past few years, with many companies becoming widely successful amid much enthusiasm from investors. However, a recent report from Bloomberg News has revealed a concerning lack of corporate governance and transparency in the sector.

Investigation conducted by Bloomberg focused on 60 companies that met certain criteria, including public listing, private fundraising of at least $1 billion, or generated significant influence in the crypto industry over January-May, 2023. The report reveals that a majority of these companies lack basic corporate structures such as independent boards of directors and auditing.

Only 63% of the surveyed companies had an independent board of directors, a basic requirement for any large firm. Even more concerning is the absence of auditing, with only half of the companies surveyed employing a third-party independent auditor. The lack of an audit is certainly a worrying trend, especially in an industry that prioritizes transparency.

Paris-based auditing firm, Mazars raised certain concerns related to the understanding of cryptocurrency firms' reports. This led to the firm distancing itself from the crypto industry late 2020, while companies such as Binance and Crypto.com were later forced to engage new auditors.

The findings of the report made it clear that there are serious issues of accountability in the cryptocurrency sector. It is essential that crypto companies update their policies to meet industry standards and adhere to commonly accepted business norms, or risk another crisis similar to that of FTX in November 2022.



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