In 2024, the US Securities and Exchange Commission collected an extraordinary $4.7 billion in fines against cryptocurrency corporations, setting a new record.
The cryptocurrency industry is currently experiencing a significant increase in enforcement actions as the SEC continues to demonstrate its regulatory authority. The SEC has collected over $7.42 billion in fines since 2013, when it first began to actively regulate digital assets. This figure represents 68% of the fines imposed this year.
Terraform Labs, the organization responsible for the Terra cryptocurrency, executed the largest settlement of the year for this year. Terraform Labs’ $4.68 billion settlement surpasses all previous penalties, surpassing the $4.3 billion agreement between the US Department of Justice and Binance, one of the world’s largest cryptocurrency exchanges, in 2023. This historic agreement demonstrates the SEC’s pivotal decision to implement regulatory measures against digital asset companies.
The SEC has filed 11 lawsuits against cryptocurrency companies in 2024 thus far, which is a decrease from the 30 lawsuits filed in all of 2023. However, the penalties have experienced a first-ever rise in value. Gary Gensler, the current chief of the Securities and Exchange Commission (SEC), has maintained an aggressive enforcement stance, asserting that numerous digital assets should be classified as securities and subject to federal regulations. The SEC has intensified its efforts to regulate the crypto industry under Gensler’s leadership, signaling that it now intends to be more aggressive in its approach.
The Securities and Exchange Commission (SEC) initiated a heightened emphasis on digital assets in 2018 by advocating for heftier penalties against cryptocurrency companies. The average sanction was a significant $1.2 billion settlement against Telegram’s cryptocurrency initiative, TON, by 2019. Under Gensler, this trend has persisted, as he led what some in the crypto industry refer to as “Operation Choke Point 2.0,” a concerted effort by regulators to reign in non-compliant crypto companies.
The SEC’s endeavors have also resulted in legal disputes with prominent cryptocurrency platforms, including Ripple and Coinbase. Additionally, the regulator has maintained its claim that a substantial proportion of digital assets are securities. Increased enforcement by the SEC and higher penalties are paving the way for a more regulated and controlled future for digital assets, ensuring full compliance with federal securities laws, as the crypto industry matures.
Also Read: South Korean Customs Link Crypto and Telegram to Drug Smuggling Rise
Wallets