San Francisco-based Coinbase, a leading cryptocurrency exchange, has recently denied engaging in proprietary trading as it claims it doesn’t trade cryptocurrencies for its own account, but for its customers.

Reports claiming Coinbase engaged in proprietary trading started appearing after the New York state’s Attorney General (NYAG) published a report, that claimed the firm accounted for nearly 20% of the transactions on its own platform.

Through a Medium post Mike Lempres, chief policy advisor at the exchange, noted the report’s findings were based on information Coinbase voluntarily provided in the Virtual Markets Integrity Initiative Questionnaire, but denied engaging in proprietary trading.

Lempres said:

Coinbase does not trade for the benefit of the company on a proprietary basis. In order to provide an easy-to-use customer experience, Coinbase Consumer quotes a price and then quickly fills the order from our exchange platform (Coinbase Markets).

He clarified that when the firm executes these trades, it does so on behalf of its Coinbase Consumer customers. To this, he added that the figure stated in the report was “misreported in the media,” as it doesn’t represent self-trading, but volume coming from Coinbase Consumer.

Lempres added Coinbase doesn’t operate a proprietary trading desk “nor does it undertake market making actions.” In its report, the attorney general’s office noted that “such high levels of proprietary trading raise serious questions about the risk consumers face on these platforms.”

It added these reportedly high levels of trading on its own account “also call into question whether the natural market for virtual currencies on those platforms is as robust as consumers might believe it to be.”

This is notably not the first time the attorney general’s office sparks controversy in the crypto space. Jesse Powell, the CEO and co-founder of crypto exchange Kraken, claimed the initial inquiry was disrespectful towards its business, and now fired back at the report.

As CryptoGlobe covered, Powell compared regulators in New York to an “abusive, controlling ex you broke up with 3 years ago but they keep stalking you, throwing shade on your new relationships, unable to accept that you have happily moved on and are better off without them.”

Kraken’s official Twitter account then seemingly mocked the report, implying taxpayers in the state helped it by doing research on their behalf, as the report has “got some interesting non-public info” on its competitors.

Kraken, later on, added that it objects to the “highly unprofessional/malicious implication that because we did not respond to the voluntary information request, we *might* be operating illegally.” In a subsequent tweet, it questioned whether it was a coincidence the report was published one day before bitcoin futures contracts expired on CBOE.