• Only half of the top 60 crypto companies have an external auditor.
• Major audit firms are either unwilling or unable to engage with them due to lack of experience with blockchain accounting and a long list of scams and scandals.
• Investors and the crypto community at large want companies to uphold higher standards but the survey results indicate that most crypto firms are still not transparent enough.
Crypto Companies Lack External Auditors
A recent Bloomberg survey revealed that only 31 out of the top 60 cryptocurrency companies have undergone a full financial audit or received reserve attestations from an independent auditor. This indicates that most crypto firms are still not transparent enough, which is concerning for investors and the crypto community at large who are seeking greater accountability in the industry.
Why Are Major Audit Firms Unwilling?
The main reason behind major audit firms‘ unwillingness to engage with cryptocurrency companies is their lack of experience with blockchain accounting as well as previous scams and scandals associated with cryptocurrency. This has created an environment where many crypto firms operate without sufficient oversight, creating risks for investors and users alike.
What Can Be Done?
In order to improve transparency in the cryptocurrency space, it is necessary for major audit firms to become more knowledgeable about blockchain technology and its associated regulations. Additionally, there must be greater efforts by governments and regulators to ensure compliance in order to reduce the risk of fraud or other malicious activities within the industry.
Increased Regulations Needed?
Increased regulation may help create more trust in cryptocurrencies as well as provide additional protection for investors who may be exposed to fraudulent activities or scams. In addition, increased regulatory oversight could help improve transparency among cryptocurrency companies which would ultimately lead to better investor protection and a healthier market overall.
Conclusion
It is clear that increased transparency is needed in order for cryptocurrencies to gain wider acceptance among both retail and institutional investors alike. The recent survey results demonstrate that there is still room for improvement when it comes to external audits among major crypto companies but this can change if regulators take steps towards introducing stricter laws governing cryptocurrencies and their associated activities.