SEC’s Crypto Actions Surge 183% After FTX Collapse
• The US Securities and Exchange Commission (SEC) has seen a 183% increase in crypto-related enforcement actions in the six months following the bankruptcy of cryptocurrency exchange FTX.
• Observers have suggested that the SEC is attempting to redeem itself for failing to police FTX.
• Ripple CEO Brad Garlinghouse claimed that the SEC’s recent enforcement actions are an attempt to distract from their failure.
Overview of Recent Crypto Enforcement Actions
The US Securities and Exchange Commission (SEC) has undertaken at least 17 crypto-related enforcement actions in the six months since cryptocurrency exchange FTX went bankrupt on November 11, 2022, representing an estimated increase of 183%. This increased activity has led observers to suggest that the regulator is trying to make up for its failure to police FTX before its collapse. Ripple CEO Brad Garlinghouse also believes that the recent actions are an attempt by the SEC to distract from its own missteps.
FTX Bankruptcy
FTX, a digital asset trading platform based in Singapore, filed for bankruptcy on November 11, 2022 after revelations of fraud and mismanagement within the company came to light. The news shocked many investors who had been relying on FTX as a reliable source of cryptocurrency trading services. This event sparked increased scrutiny from regulators around the world, including those in the US which resulted in intensified enforcement action from US authorities against crypto-related firms.
SEC’s Surge In Crypto Enforcement Actions
An analysis conducted by Cointelegraph found that in the six months prior to FTX’s collapse, there were approximately six crypto-related enforcement actions taken by US regulators while this number jumped significantly — at least 17 — in the six months after FTX went under. This surge was highlighted by U.S Representative French Hill who said at an event in Washington D.C.: “[Gensler] opened up this year with all these enforcement actions; I think it looks like [cover your ass] to me.”
Markus Thielen’s Viewpoint
Markus Thielen — head of research and strategy at Matrixport and author of Crypto Titans: How trillions were made and billions lost in the cryptocurrency markets — previously told Cointelegraph he believes there is an air of “embarrassment” surrounding those who failed catch issues at FTX prior to its bankruptcy filing. Furthermore, Ripple CEO Brad Garlinghouse echoed this sentiment claiming recently on Twitter that “the SEC continues with attempts to distract from their failure with respect to regulating #crypto.”
Conclusion
In conclusion, it appears as though increased regulation around cryptocurrencies may be more closely linked than initially thought with recent events such as FTX’s bankruptcy filing last November leading directly or indirectly towards heightened policing efforts from regulatory bodies such as SEC within this space going forward into 2023
