Crackdown on Cryptocurrency: $2.35 Billion Worth of Penalties by the SEC

SEC’s Heavy-Handed Approach

Since 2013, the Securities and Exchange Commission (SEC) has been on a rampage in the digital asset marketplace, slapping participants with a whopping $2.35 billion in penalties. According to a recent report by Cornerstone Research, this sweeping enforcement was not just a flash in the pan, but part of a larger trend that saw 97 enforcement actions initiating from 2013 through 2021.

Breaking Down the Numbers

Out of those 97 actions, 58 were full-on litigations, while the rest were administrative proceedings. The combination led to a staggering $2.35 billion being raised, with $1.71 billion coming from litigations alone and $640 million from administrative actions. It’s a hefty price tag for anyone who thought investing in crypto was just a carefree joyride.

Who’s Paying the Price?

In the grand scheme of things, firm respondents found themselves on the hook for the lion’s share, contributing $1.86 billion of the total. Individuals, however, didn’t escape unscathed either, being charged a combined $490 million. The numbers are enough to make your head spin, but at least now we know who’s not buying a yacht anytime soon.

The Surge of Actions Since 2017

While the SEC took a leisurely pace between 2013 and 2017, with only six initiated cases during that time, things took a sharp right turn in 2017. Hello, ICO craze! The SEC’s litigation efforts exploded, with 20 enforcement actions documented in just 2021 alone, of which 70% were tied to initial coin offerings. Talk about making up for lost time!

Future of SEC’s Oversight

As we move into the new year, experts like Cornerstone Research’s vice president Abe Chernin predict that the SEC isn’t about to take its foot off the gas pedal anytime soon. With Gary Gensler at the helm, the agency has been making waves in crypto lending, unregistered exchanges, and decentralized finance (DeFi) platforms. So, if you thought the SEC was going to slow down now, think again. They got a new staff addition to oversee cryptocurrencies—Corey Frayer—who might just be the new sheriff in town.

So, buckle up, folks. The SEC is here, and they’ve got your virtual wallets in their sights!