3 - 4 minute read
The U.S. Securities and Exchange Commission (SEC) is continuing its crackdown on the crypto industry by adding more attorneys to its Crypto Asset and Cyber Unit (CACU). The agency is currently seeking general attorneys to join its enforcement division in New York, Washington, D.C., and San Francisco, according to a job posting.
Initially meant to be a 20-person operation, the CACU has since doubled its size, and the SEC announced in March that it was “planning to add additional staff” to the unit. Under Chair Gary Gensler, the SEC has taken a renewed vigor to investigate and enforce federal securities laws violations in the crypto industry.
The attorneys joining the CACU are expected to investigate “crypto asset securities,” develop litigation plans, create legal documents, and conduct depositions. The unit “exercises the full range of the Division’s investigative and law enforcement powers,” according to the job posting. The compensation for these positions ranges from $140,000 to $260,000, depending on the location.
This move by the SEC suggests that it is committed to continuing its crackdown on the crypto industry. With the collapse of powerful players in the sector, such as FTX, during the 2022 market turmoil, the regulator sees the need to enforce the federal securities laws. The SEC has been actively pursuing cases against entities that offer unregistered securities or violate anti-fraud regulations.
According to Peter Van Valkenburgh, director of research at Coin Center, a digital currency advocacy group, “The SEC has made it clear that they consider most initial coin offerings (ICOs) to have been illegal unregistered securities offerings.”
This could pose a risk to traders who invest in cryptocurrencies that could be considered unregistered securities. The SEC has already pursued cases against Ripple and Kik Interactive for selling unregistered securities in the form of their digital tokens.
Furthermore, this SEC action could impact the market by creating greater scrutiny of digital assets. The increase in investigations from the CACU may lead to a drop in demand, lowering the price of crypto assets. On the other hand, more scrutiny and enforcement could create greater credibility in the industry and provide a safer environment for investors.
The Bottom Line
This SEC move indicates that the regulatory body is committed to continuing its crackdown on the crypto industry. Traders need to be aware of the potential risks of investing in cryptocurrencies that may be considered unregistered securities. Increased investigations from the CACU may negatively impact market demand, leading to lower prices. However, greater oversight and enforcement may bring more credibility, making crypto assets safer for investors.