Module 3 · Chapter 8

Market Abuse

Market abuse means trading on secrets or faking the market. MiCA bans both, and makes a firm that carries out its clients' trades watch for abuse and report it to the regulator.

≈ 11 min read 8-question test

In this chapter

  • What MiCA bans: insider dealing and market manipulation
  • Why a firm with no trading platform must still watch for abuse
  • How a surveillance alert becomes a report to the Central Bank

8.1Market abuse in one paragraph

Market abuse means cheating the other traders in a crypto-asset. The cheat either trades on a secret that would move the price, or fakes the market with false trades, orders or rumours. MiCA bans both in Articles 86 to 92, and makes firms like Halcyon watch for abuse, stop it and report it. This chapter follows one alert, on a token called PLM, from the screen to the report.

Key point

If abuse passes through Halcyon's app, Halcyon must act. It does not matter that the market itself is somewhere else.

Also in this chapter

  1. Why the law bans fake trading
  2. Why the rules reach a firm with no trading platform
  3. Inside information and the insider list
  4. Four ways to fake the market
  5. How surveillance read the PLM pattern
  6. From alert to report
  7. Restricting the accounts and keeping the record
  8. Your job

Preview

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