Cryptoskeptics Forum

Cryptoskeptics Forum Issues Report to Congress on the Crypto Industry's Concentrated and Dangerous Market Structure

A functional map of the industry finds that its central segments are highly concentrated, heavily foreign-controlled, and operating outside the rules that govern banks and securities markets.

Washington: The Cryptoskeptics Forum, a non-partisan, all-volunteer group of retired government, legal, and academic professionals, has released its Report to Congress examining how the crypto industry is structured and the risks that structure poses to the financial system and the public.

The report maps the industry across six functional segments and measures how concentrated each one is using the Herfindahl-Hirschman Index, the standard metric federal antitrust agencies use to assess market concentration. It finds that several core segments, among them centralized exchanges and stablecoin issuance, are highly concentrated and dominated by a small number of firms, many of them based or controlled outside the United States.

The report also documents how single firms stack conflicting roles across trading, custody, and settlement, functions that are kept separate in regulated banking and securities markets to protect customers and contain risk. It argues that crypto firms performing those functions should be held to the same standards.

Crypto is not a single market, but an identifiable industry whose core segments are concentrated, interconnected, and largely unregulated. Congress should hold these firms to the same rules that govern the rest of the financial system. From the Report to Congress, Cryptoskeptics Forum

The full report is accompanied by an interactive Study that lets readers explore the data behind each segment, including market shares, concentration scores, and the overlapping roles held by the largest firms.