The United States Securities and Exchange Commission has brought 56 enforcement actions against initial coin offerings, blockchain and digital asset-related companies since July 2017. On Nov. 16, the SEC released a report on the commission’s selected accomplishments during chairman Jay Clayton’s tenure from May 2017 until November 2020. As part of the 28-page report, the regulator mentioned the SEC’s efforts to combat “cyber-related misconduct” including violations by companies involved in the crypto industry. According to the report, the SEC brought 56 cases involving attempts to defraud investors through the use of digital asset securities as well as violations of the …

Jay Clayton, who has served as the chairman of the United States Securities and Exchange Commission since May 2017, will be leaving the agency by 2021. In its official news release, the agency noted that Clayton has been one of its longest-standing chairs. Crypto enthusiasts will likely be familiar with the agency's work, whose activities have engaged some of the most controversial regulatory questions facing the new asset class. These include early debates as to whether or not certain crypto assets should be defined as a security in accordance with the 71-year-old Howey Test. As chairman, Clayton also warned Bitcoin …

Earlier this year, the United States Securities and Exchange Commission — in both the SEC versus Telegram and SEC versus Kik cases — vigorously argued that sales of contractual rights to acquire tokens on a when-issued basis (widely referred to as Simple Agreements for Future Tokens, or SAFTs) should be integrated with later sales of the tokens. When the judges in those cases issued rulings agreeing with the SEC, it felt like a door was closing on the SAFT process, making it unworkable for future crypto offerings. Then, on Nov. 2, a divided SEC adopted a series of amendments to …

The Enforcement Division of the U.S. Securities and Exchange Commission has collected more than $4.68 billion in illegal income and fines this year so far — with more than one quarter coming from Telegram’s ill-fated Gram token sale alone. In total, around $1.26 billion was handed over to the SEC by unregistered initial coin offerings. SEC Division of Enforcement Director Stephanie Avakian stated: “The Commission obtained judgments and orders totaling approximately $4.68 billion in disgorgement and penalties – the highest amount on record.” The division’s annual report for the 2020 fiscal year, published earlier this month, provides a comprehensive overview …

Veteran trader and chart analyst Peter Brandt is the latest figure in the cryptocurrency community to dispute the regulatory status of XRP. According to the chartist, XRP — the fourth-largest cryptocurrency at publishing time — is a security, which means that the coin should fall under the regulatory purview of the United States Securities and Exchange Commission. “XRP would have been declared as a security if the SEC understood cryptos,” Brandt argued in a tweet on Nov. 10. Brandt’s comments came in response to a statement by Twitter user Rexiby crypto, who claimed that “XRP company owns almost half of …

Telegram Messenger Inc. has been ordered to pay nearly $625,000 worth of legal fees to a small cryptocurrency firm that it sued over using the ‘GRAM’ crypto ticker and trademark. In a Nov. 2 ruling, United States District Judge Charles Breyer granted $618,240 in attorney’s fees for 1,030.4 hours of work billed at $600 per hour. Lantah had requested compensation at a rate of $900 per hour, but the judge reduced the fees to meet the market rate for the services. Lantah was also awarded $6,737.35 in costs that Telegram did not object to. Lantah LLC has been defending the …

U.S. federal prosecutors are pushing for a heavy prison sentence to be levied against one of the founders of Centra Tech — the company behind a notorious initial coin offering in 2017 that was promoted by professional boxer Floyd Mayweather and musician DJ Khaled. In a government sentencing submission filed on Oct. 31, the government requested that U.S. District Judge Lorna Schofield sentenced Centra Tech co-founder Robert Joseph Farkas to “a substantial term of imprisonment” to deter other fraudsters from conducting unlawful ICOs. “While legitimate ICOs represent a new and efficient means to raise capital, the loss of investor confidence …

Lawyers representing investors in a class action against BProtocol Foundation, parent company of decentralized liquidity network Bancor, have asked for the case to be tried in the United States rather than Israel. According to court records filed on Nov. 2 in the U.S. Southern District of New York, lawyers for Timothy Holsworth, the lead plaintiff in the class-action lawsuit against defendants BProtocol and four of its executives, argued that the firm’s “repeated and extensive contacts with the United States” for marketing its Bancor Network Token (BNT) made the SDNY the more appropriate venue. Lawyers for BProtocol co-founders Eyal Hertzog, Yehuda …

The United States Securities and Exchange Commission voted to amend a set of rules to simplify and improve the "overly complex" procedures for exempt securities offerings. According to an announcement Monday from the SEC, the proposed changes aim to "harmonize, simplify, and improve" the existing "overly complex" framework to make it easier for companies to conduct offerings while still protecting investors. The regulatory body stated that the amendments would "address gaps and complexities" in the current exempt-offering framework, facilitating access to investment opportunities for investors and to capital for securities issuers. “For many small and medium-sized business, our exempt offering …

The United States Attorney General’s Cyber-Digital Task Force recently unveiled the result of its months-long effort to evaluate emerging cryptocurrency-related threats and articulate law enforcement strategies for countering them. The resulting guidance leaves the reader with an impression that its authors have a sound understanding of how the focal asset class works as well as a certain fixation on the ways it can be misused, as some observers contend. In the highly charged atmosphere of the final weeks before the presidential election, with high-profile enforcement actions against the people behind crypto derivatives exchange BitMEX and the U.S. government’s sweeping anti-monopoly …

Global digital asset trading platform INX is expanding its ongoing initial public offering, with listings on exchanges worldwide. In a move to boost the liquidity in its $117 million IPO, INX has applied with the Canadian Securities Exchange to list its security token. The listing application is subject to the approval of the CSE, according to an Oct. 30 announcement from INX. According to INX’s representatives, the company expects to list the INX token on many other global exchanges, but the CSE will be the first. “This will provide dramatically higher access to capital and liquidity on a global scale, …

On Wednesday, the Securities and Exchange Commission (SEC) announced the departure of William Hinman by the end of this year. Hinman joined the commission in 2017 and is currently the director of the SEC's Division of Corporate Finance. He also spearheaded the SEC's early work with digital assets, in which role he has made critical contributions to the discussion of which cryptocurrencies qualify as securities. The announcement says: "Mr. Hinman led efforts regarding the rapid innovation in digital assets, including by providing a framework that market participants could use to evaluate whether digital assets are offered and sold as securities." …