The Commodity Futures Trading Commission (CFTC) released its annual enforcement results, indicating a commitment to reining the digital assets’ ecosystem. The year in review notes that the CFTC filed 82 enforcement actions against defaulters, with a fifth of the affected firms are service providers in the digital assets industry.
The Commission noted that it was pleased with its enforcement results and a series of “hard-fought successful litigations” indicates that it is on the right path. “The Enforcement Division demonstrated its professionalism, expertise and skill through the breadth, complexity and importance of the investigations conducted, the cases filed, and the successes achieved.”
The digital asset industry was firmly in the crosshairs of the CFTC, as 20% of all enforcement actions were against the firms in the industry. Tether, issuers of the USDT stablecoin, were hit with a civil monetary penalty of $42.5 million for “misleading statements” surrounding the backing of the stablecoin.
Bitfinex fell under the hammer of the CFTC as it was found guilty of taking part in “illegal” and “off-exchange” retail transactions in virtual currencies, while a South African pool operator and CEO Cornelius Johannes Steynberg was hit with fraud charges.
Decentralized Autonomous Organizations (DAOs) were not left out in the crackdown, with the commission imposing a $250,000 fine against bZeroX, its successor Ooki DAO. The fine against the DAO triggered mass outrage, with some industry participants calling the move “regulation by enforcement.”
The heightened regulatory effort by the CFTC is in stark contrast to its previous statement pledging to handle the virtual assets ecosystem with velvet gloves. However, Rostin Behnam, head of the Commission, voiced the new stance of the CFTC, warning operators not to expect a “free pass” going forward.
The CFTC’s sister agency is also on a rampage
The CFTC is not the only agency in the U.S. cracking down hard on digital assets. On the other side of the divide, the Securities and Exchange Commission (SEC) has scored impressive victories against virtual asset service providers for breaching extant securities rules.
Gary Gensler-led SEC once branded the industry as the Wild West and pledged to make a valiant effort at policing the industry. To achieve its aim, the SEC has increased the size of its digital asset arm, the Crypto Assets and Cyber Unit, with 20 new positions.
“By nearly doubling the size of this key unit, the SEC will be better equipped to police wrongdoing in the crypto markets while continuing to identify disclosure and control issues with respect to cybersecurity,” said Gensler.
Watch: The BSV Global Blockchain Convention panel, Law & Order: Regulatory Compliance for Blockchain & Digital Assets
New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.