SEC Cracks Down on Crypto Industry: 127 Enforcement Actions and $2.61 Billion in Penalties

• The SEC has filed 127 crypto-related enforcement actions since 2013.
• Of these, 82 were litigations and 45 were administrative proceedings.
• The monetary penalties across the settlements with the regulator reached $2.61 billion by the end of last year.

The US Securities and Exchange Commission (SEC) has been tightening its grip on the crypto industry for the past several years, with the aim of protecting investors from potential fraud and other dubious activities. Since July 2013, the agency has brought 127 such actions, with 30 of these in 2022 representing a 50% increase from 2021. The monetary penalties across the settlements with the regulator reached $2.61 billion by the end of last year.

The SEC’s first crypto-related enforcement action was in July 2013, when it charged Trendon T. Shavers, the operator of an alleged Ponzi scheme related to Bitcoin. Since then, the regulatory watchdog has gone on to bring charges against a wide range of crypto-related companies, including those that have been accused of running Ponzi schemes, market manipulation, and fraudulent ICOs.

One of the most recent cases is the high-profile charges against former FTX CEO and founder Sam Bankman-Fried, who was arrested following the exchange’s collapse. Also charged were Alameda’s Caroline Ellison and FTX’s Gary Wang. The SEC also filed charges against crypto platforms Gemini and Genesis.

The increased regulatory scrutiny has had a profound impact on the crypto industry, with many exchanges and other companies facing heavy fines for failing to comply with the SEC’s regulations. According to a recent report by Cornerstone Research, the total monetary penalties across the settlements with the regulator reached $2.61 billion by the end of last year.

The SEC’s enforcement actions have been met with some criticism, with some accusing the regulator of “regulation by enforcement”. However, the agency has maintained that its primary goal is to protect investors from potential fraud and other dubious activities in the crypto space.

The agency has also been pushing for greater regulatory clarity in the crypto space, and has recently proposed a new set of rules that would make it easier for crypto companies to register with the SEC. The SEC is also working on a new set of guidelines for crypto exchanges and other companies to follow, thus ensuring that they are compliant with the law.

It remains to be seen how the SEC’s increased enforcement actions will impact the crypto industry in the long run, but it is clear that the agency is taking a more active role in the space. With the increasing number of enforcement actions, the SEC is likely to continue to be a major force in the crypto space for the foreseeable future.