SEC Adds More Agents As It Strengthens Crypto Enforcement

The agency announced in May that it would add 20 employees to its Crypto Assets and Cyber ​​Unit, bringing the total number of employees in the unit to 50. CoinDesk reported that it has filled almost all of those positions and plans to add even more staff to the unit in the future, although it hasn’t said how many.

In a May statement, the agency claimed that its Crypto Assets and Cyber ​​Unit had initiated more than 80 enforcement actions against unregistered crypto asset offerings and platforms since its inception in 2017, resulting in financial relief of more than 2 billion US dollars.

The SEC did not immediately respond wealth‘s request for comment.

The additions to the crypto-specific entity come as the SEC and Chairman Gary Gensler launched a series of enforcement actions against the crypto industry over the past few months. Meanwhile, leaders in the space, such as Coinbase CEO Brian Armstrong, have called for a “clear rulebook” for crypto assets and have criticized Gensler’s regulation-through-enforcement approach.

Last month, the agency settled a $30 million settlement with US-based crypto exchange Kraken over allegations that its staking product offered customers unregistered securities. While Kraken agreed to shut down the product, it did not deny or admit to the agency’s allegations.

The SEC also indirectly hit top crypto exchange Binance last month by saying it plans to sue Paxos, the US-based creator of BUSD, the stablecoin that uses its name. The agency said in a note to Paxos that stablecoin BUSD is an unregistered security.

It also targeted Terraform Labs, the Do Kwon-led company whose cryptocurrencies, stablecoins TerraUSD and Luna, failed spectacularly last year, causing investors billions in losses. The SEC charged Terraform Labs and Kwon with fraud and selling unregistered securities.

Gensler continued to ramp up the pressure on the industry following FTX’s bankruptcy late last year. The SEC chairman has previously said that crypto is the “wild west” and that most digital tokens are securities.

At a conference on Thursday, Gensler added that crypto exchanges should also not be considered qualified custodians for the safekeeping of assets, including cryptocurrencies, and cautioned investment advisors against working with them.