With Code of Conduct, Trade Group ADAM Seeks Legitimacy for Crypto

One year after its formation, the Association of Digital Asset Markets has drafted a code of conduct for the cryptocurrency market.

The trade group has also recruited five more companies, bringing its total membership to 15.

"The digital asset industry has had a rocky first decade. Crypto investors have learned all the hard lessons of a century's worth of financial crime and scandal in the course of ten years," said Dan Burstein, the general counsel and chief compliance officer at the Paxos exchange, one of the group's 10 founding members.

The draft says ADAM members should "Be truthful in their statements, use clear and unambiguous language, make clear whether the prices they are providing are firm or indicative, and provide to clients and counterparties all material information" about business relationships.

The group expects them to sign a final version of the code in early 2020.

"As digital asset markets become ever-more enmeshed in capital markets, it is important to level the playing field and establish the high standards and operating protocols deserving of this promising and innovative asset class," said Philippe Bekhazi, CEO of XBTO Group, another ADAM founding member, in a press release.

Although it is not a regulatory document, companies that are found to have violated the code run the risk of being kicked out of the association and losing what ADAM hopes will become a powerful imprimatur in the market.

"Being associated with ADAM is a signal to investors, business partners and regulators that you are making an effort in good faith to live by certain standards," Burstein told CoinDesk.

ADAM's is not the first code of conduct for the nascent crypto industry - Global Digital Finance, a London-based trade group with more than 70 members, released one last year.

ADAM's code is comparatively tidy: less than 4,000 words in a single, 12-page document.