Aer Compliance’s Post

SEC Charges Three So-Called Market Makers and Nine Individuals in Crackdown on Manipulation of Crypto Assets Offered and Sold as Securities 2024-166 Washington D.C., Oct. 9, 2024 — The Securities and Exchange Commission today announced fraud charges against three companies purporting to be market makers and nine individuals for engaging in schemes to manipulate the markets for various crypto assets being offered and sold as securities to retail investors. As alleged, the schemes were intended to induce investor victims to purchase the crypto assets by creating the false appearance of an active trading market for them. https://lnkd.in/ekMdSJA7

🚨 SEC Charges Chicago-based Company for Operating as an Unregistered Dealer in Crypto Asset Markets 🚨 The SEC recently charged Cumberland DRW LLC, a Chicago-based company, for operating as an unregistered dealer in crypto assets, trading more than $2 billion worth of assets that were allegedly offered as securities. The complaint, which spans activities from March 2018 to the present, accuses Cumberland of acting as a dealer without the proper registration. Cumberland claims to be one of the world's top crypto liquidity providers, operating 24/7 through its trading platform, Marea. However, the SEC alleges they violated Section 15(a) of the Securities Exchange Act of 1934, which requires dealers in securities to be registered. ⚖️ Why this matters to you: If you're involved in the crypto space, or any securities trading, this case highlights the importance of compliance with federal registration requirements. The SEC is making it clear that crypto asset markets are not exempt from securities laws, and failing to register can lead to significant legal and financial consequences. Head to the full SEC Press Release to learn more: https://hubs.li/Q02TrCHd0 #Crypto #Compliance #SECEnforcement #InvestmentAdvisors #Regulation #SecuritiesLaw

Last week, LEJILEX and the Crypto Freedom Alliance of Texas have taken a bold step by filing a complaint against the SEC, seeking to challenge the SEC's stance on the operation of digital asset platforms, particularly those facilitating secondary market transactions. Their main requests to the Northern District of Texas (where the lawsuit was filed) are as follows: - acknowledgment that transactions of digital assets on secondary markets do not constitute securities transactions, thus arguing that platforms like Legal.Exchange should not be classified as unregistered securities exchanges. - confirmation that operating such a platform does not equate to acting as an unregistered broker or clearing agency, thus preventing the SEC from initiating enforcement actions against them or similar entities for not registering in these capacities. This case could set a precedent for how digital assets are regulated in the future, so let's see how the SEC responds.

News Alert 🇺🇸 A new US bill, the BRIDGE Digital Assets Act, proposes a joint SEC-CFTC committee to provide regulatory guidance for the crypto industry. ◾ Introduced by Rep. John Rose, the bill would establish a joint committee between the U.S. Securities and Exchange Commission and U.S. Commodity Futures Trading Commission to study digital assets and streamline the legal framework to protect consumers. ◾ The committee will include 20 nongovernmental stakeholders, meeting at least twice a year, to focus on decentralization, market efficiency, and consumer protection. ◾ The bill seeks to end the "regulation-by-enforcement" approach, encouraging collaboration between the public and private sectors on digital asset oversight. Read more The Block👇 https://lnkd.in/effxiVJC

🚨 BREAKING NEWS in the crypto world! The SEC has taken legal action against Cumberland DRW for unregistered securities trading. As one of the leading liquidity providers globally, Cumberland plays a crucial role in the trading and investment landscape. This development raises significant questions about regulatory compliance and the future of trading practices in the crypto space. Stay tuned for updates as this story unfolds!

It’s kind of remarkable how the United States could transition from being the most regulated jurisdiction to becoming the most favorable for establishing a crypto company within a matter of ~2 months.

Regulation News of the Week (NZ & AU) Australia's Financial Regulator Proposes New Crypto Rules, Highlights Risks and Relief for Industry. Australia orders $5.1 million fine on Kraken crypto exchange operator. Australian Regulator Seeks Public Input on Crypto-Asset Regulations. ASIC finds flaws in complaints management culture.

US panel urges greater crypto asset regulation On Friday, the Financial Stability Oversight Council (FSOC) recommended that Congress pass legislation "providing federal financial regulators with explicit rulemaking authority over the spot market for crypto assets that are not securities." It also urged lawmakers to approve rules creating a federal framework for stablecoin issuers. https://lnkd.in/e2wcAiAF

Another crypto case involving an unregistered b-d. eToro settled charges with the SEC that it operated an unregistered broker and unregistered clearing agency in connection with its trading platform that facilitated buying and selling certain crypto assets as securities. The firm operated as a broker and clearing agency, allowing U.S. customers to trade crypto assets offered and sold as securities through its online platform. However, the firm did not comply with the registration provisions of the federal securities laws. The firm agreed to cease and desist the activities and pay $1.5 million to settle charges. The firm also agreed to liquidate any crypto assets offered and sold as securities that it cannot transfer to its customers and return the proceeds to the respective customers. #SEC, #digitalassets, #crypo, #regulatorycompliance Read More👇:    https://lnkd.in/eWhSCmjS.   

Why does it matter if altcoins traded on the secondary market are considered securities? Because now we have a precedent for an insider-dealing settlement in the US. A judge in the US has decided that altcoins sold on secondary markets are, in fact, securities. This decision could have a big impact on the future of crypto trading. Ishan Wahi, a former manager at Coinbase, along with his brother Nikhil and their mutual friend Sameer, were the subjects of a high-profile case that led to this verdict. Entrusted with in-depth knowledge of Coinbase's asset listings, Ishan Wahi gave Nikhil Wahi and Sameer Ramani access to this private information. Ramani alone made $817,602 in profits from illegal trading by using these insights. The SEC said that this was a clear breach of securities laws. “According to the SEC, the tokens in which Ramani traded were investment contracts and, therefore, securities, because each involved the investment of money, in a common enterprise, with a reasonable expectation of profit derived from the efforts of others,” the court document stated. The court ruled to prohibit Ramani from future violations, a civil penalty of twice the amount of proceeds Ramani is calculated to have gained, which was a total of $1,635,204, and disgorgement of the identified proceeds amounting to $817,602. As European regulators and CASPs prepare for the December 2024 go-live of #mica, it appears that this decision may shift perceptions regarding what falls under MiFID or MiCA. #marketabuse #insidertrading #tradesurveillance