TL; DR Breakdown
- The SEC has slammed $2.4 billion in penalties on crypto companies
- A total of 97 companies have been affected
- The agency will continue with a crackdown in 2022
Over the last few years, the United States Securities and Exchange Commission has been involved in lawsuits involving so many companies. This is because, with the growing rate of the sector, it has become necessary to monitor its activities. According to a report from Cornerstone Research, the United States regulatory authority has slammed penalties of about $2.4 billion in total on companies across the crypto sector.
The SEC has slammed penalties on 97 companies since 2013
According to the research, this figure is only responsible for the total penalties that the regulatory watchdog has slammed on companies since 2013. The report also mentioned that the body had been involved in one skirmish or another over the same time frame, with nothing less than 97 companies in the crypto sector. Cornerstone report mentions that of the 97, 58 were purely litigation while the remaining figure were administrative lawsuits.
In the same vein, litigations were responsible for $1.71 billion, while administrative lawsuits were responsible for $640 million. The report also claimed that charges against companies were about $1.86 billion while those against individuals were around $490 million. The report mentioned that even though the SEC dished out its first fine against a company in 2013, it wasn’t until 2017 that they gained ground. The report noted that the list of dined companies across 2013 and 2017 was about six.
The agency will continue with its crackdown in 2022
The report further shows that the agency launched only 20 of the entire lawsuits last year. While administrative proceedings were responsible for six, there were 14 litigations. The report also ties about 70% of the entire lawsuits to Initial Coin Offerings. The report stated explicitly that 65% of the enforcement were frauds while 80% were cases tied to unregistered securities.
According to the author of the paper, the significant period of enforcement by the SEC came around May and September. One notable factor that she pointed out was the appointment of the head of the agency, Gary Gensler, in April. Cornerstone has also mentioned that the body might continue to crackdown on crypto companies this year, leading to many penalties and lawsuits.