How to Choose the Right SEC-Regulated Platform
Choosing the right SEC-approved crypto platform might seem complicated. Compliance is what many traders look for. When selecting the best regulated exchange or broker, you should pay attention to several important factors. Let’s break them down.
- Registration
Check if the platform is really registered with the SEC. You can do it on the regulator’s official website or use BrokerCheck by FINRA. - SIPC Participation
SEC-registered crypto platforms are often a part of Securities Investor Protection Corporation (SIPC). This organization protects investors in case their brokers go bankrupt. - Reputation and History
Make sure that the chosen SEC-regulated platform did not have security breaches. It is also important to know that it was never fined–the opposite would imply that the platform does not follow all the rules and standards. Go to Trustpilot, Reddit or any other websites where you could find everything on the platform’s reputation. - Fees and Conditions
Pay attention to fees for deals, minimal deposit and available assets. All these factors are important for seamless and convenient trading.
Choose an SEC-regulated platform with a solid reputation, low fees and the tools you need. Always verify its registration through SEC EDGAR or FINRA BrokerCheck.
What Makes a Crypto Platform SEC-Compliant
Companies dealing with securities (stocks, bonds, ETFs, mutual funds) must be officially registered with the SEC. This applies to brokers, investment advisors and firms issuing securities.
Additionally, to obtain SEC registration, platforms must comply with several key laws. For example, the Securities Act of 1933 regulates initial public offerings (IPOs), while the Securities Exchange Act of 1934 governs stock market trading. There are also rules like Best Execution, which require brokers to execute client orders under the most favorable terms available.
An important aspect is client fund protection. SEC-compliant platforms must keep customer funds segregated from their own assets. Moreover, many of them are insured through the SIPC (Securities Investor Protection Corporation), guaranteeing up to $500,000 per customer in case of broker bankruptcy.
Transparency is another key requirement. Platforms must file regular reports with the SEC (e.g., Form 10-K and 10-Q), disclose potential conflicts of interest and provide clients with full product disclosures.
Advertising and marketing are also regulated. Misleading investors—for example, by promising “guaranteed returns”—is prohibited. All promotional materials are reviewed by FINRA (Financial Industry Regulatory Authority) if the platform is a broker.
The SEC also monitors platforms for fraud and insider trading. Compliance involves implementing surveillance systems and adhering to laws like the Sarbanes-Oxley Act and the Dodd-Frank Act. If a platform meets all these requirements, it is considered SEC-compliant.
Conclusion
Registration with the SEC is one of the most important factors, and many platforms are seeking to get it. For that, they need to follow several important laws and rules. Compliance can boost users’ trust and confidence in the platform, ensuring that their investments are safe.
FAQ
There are several crypto platforms that are officially approved by the SEC. Most prominent ones include Figure Markets, tZERO and Prometheum ATS.
Yes, Figure Markets requires KYC.
SEC oversight requires tokenized securities to comply with the same regulations as traditional securities. Platforms offering them must either register as broker-dealers or ATS with the SEC and FINRA, ensuring investor protection, transparency and AML compliance. Failure to follow these rules risks enforcement actions, fines or shutdowns
To be SEC-compliant, a crypto broker-dealer must register with the SEC and FINRA, adhere to securities laws and implement anti-fraud, customer protection and AML/KYC procedures.
Yes, retail users can access SEC-approved platforms. However, their eligibility depends on the platform’s specific requirements and the type of securities offered.