from the SEC’s perspective the important thing here is that the rules for securities exchanges are designed to protect investors. In particular, they tend to require a separation of three key functions — the exchange that matches buyers and sellers, the broker-dealer that trades on the exchange on behalf of customers, and the clearinghouse that actually moves the money and securities — that are usually combined in crypto. In the stock market, you go to Robinhood’s website to put in an order to buy stock on the New York Stock Exchange, and the Depository Trust Co. keeps custody of the stock and settles the trade. In the crypto market, you go to Coinbase’s website to put in an order to buy crypto on Coinbase, and Coinbase keeps custody of the crypto and settles the trade.
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