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Sunday, May 22, 2022

$2.4Bn Worth Of Crypto Penalties Issued By The SEC Since 2013

The SEC (Securities and Exchange Commission) has so far issued approximately $2.35Bn in total worth of penalties for digital asset marketplace participants. The record is from 2013. Cornerstone Research’s report on Jan 19th revealed the data.

The Details Of The SEC’s Penalties

The report was titled “SEC Cryptocurrency Enforcement: 2021 Update”. It discovered that the agency has brought about 97 enforcement actions in total amounting to $2.35Bn since 2013 till 2021 ended.

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58 of these 97 actions fell under the category of litigations. Administrative proceedings made up for the rest of the 39. Of the entire amount of $2.35Bn raised via these actions, litigation charges made up for $1.71Bn. Administrative proceedings accounted for $640Mn.

Most of the parties charged were only firm respondents. They accounted for $1.86Bn of the entire $2.35Bn. At the same time, charges for the individual respondents made up for the $490Mn that remained.

In 2013 July, the agency had issued its first-ever financial penalty for a participant in cryptocurrency. However, according to the report, it won’t be until 2017 that crypto-related litigation initiated by the the agency starts picking up pace. From 2013 till 2017, only 6 cases related to crypto were initiated by the agency.

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In 2021 alone, 20 among the 97 actions were launched by the agency. 14 of them were litigation actions in the federal courts of the US. The other 6 were administrative proceedings. Among these 20 actions related to enforcement, 70% of them were associated with ICOs (initial coin offerings).

Simona Mola, the author of the report, suggested that the recent crypto crackdown of the SEC on crypto may have a link with Gary Gensler’s appointment as the chair of the SEC in 2021 April. She noted that enforcement by the SEC had been much higher from May-end till Mid-September.

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