The US Federal authorities is knocking more durable and more durable on that crypto door, with Washington now making a minimum of one main crypto-related regulatory announcement each week.
This week’s got here from the Securities and Exchange Commission, the Washington company finally accountable for regulating US shares and securities. The SEC has engaged one in all its high cyber crime consultants, Valerie Szczepanik, to “co-ordinate efforts across all … Divisions and Offices regarding the application of US securities laws to emerging digital asset technologies and innovations.”
Her remit consists of “both Initial Coin Offerings and crypto-currencies,” which successfully means Szczepanik is the SEC’s crypto-currency supremo.
“Valerie’s thought leadership in this area is recognized both within the commission and across financial regulators in the United States and abroad,” mentioned SEC Chairman Jay Clayton. “With her demonstrated skill, experience and keen awareness of the importance of fostering innovation while ensuring investor protection, Val is the right person to coordinate our efforts in this dynamic area that has both promise and risk.”
Only days earlier than the Szczepanik announcement, on May 29, the US Department of Justice announced it was opening a felony probe into whether or not merchants have been manipulating the value of digital currencies. Federal prosecutors are actually working with the Commodity Futures Trading Commission, the monetary regulator with duty for overseeing Bitcoin derivatives, and particularly are inspecting allegations of each ‘spoofing’ and ‘wash trading’.
Significantly, the Department of Justice motion marks the primary time that each main regulator companies accountable for US capital markets – the Commodity Futures Trading Commission and the US Securities and Exchange Commission – have been publicly concerned in anti-crypto fraud actions. And there’s extra.
On May 22, once more solely days earlier than the DoJ announcement, the North American Securities Administrators Association mentioned its members have been finishing up 70 state- and provincial-level investigations, simply since April, and that the actions, into crypto-currency scams and fraudulent ICOs, are “just the tip of the iceberg.”
Dubbed Operation Crypto-sweep , the investigations are receiving the total public assist of the US Securities and Exchange Commission, with Clayton saying it “should be a strong warning to would-be fraudsters in this space that many sets of eyes are watching, and that regulators are coordinating on an international level to take strong actions to deter and stop fraud.”
And per week earlier than the Crypto-sweep announcement, the SEC was once more within the news when it was behind a spoof web site that contained an ICO launch meant “to educate investors about what to look for before they invest in a scam.”
The “Howey Coin” claimed to mix “the two most growth-oriented segments of the digital economy, blockchain technology and travel” … it was to be “the newest and only coin offering that captures the magic of coin trading profits AND the excitement and guaranteed returns of the travel industry.” But anybody who clicked on the spoof web site’s ‘Buy Coins Now’ button was as a substitute led to investor schooling instruments and ideas from the SEC and different monetary regulators.
“The rapid growth of the ‘ICO’ market, and its widespread promotion as a new investment opportunity, has provided fertile ground for bad actors to take advantage of our Main Street investors,” mentioned SEC chairman Jay Clayton.
“We embrace new technologies, but we also want investors to see what fraud looks like, so we built this educational site with many of the classic warning signs of fraud. Distributed ledger technology can add efficiency to the capital raising process, but promoters and issuers need to make sure they follow the securities laws. I encourage investors to do their diligence and ask questions.”
The newest SEC announcement regarding Szczepanik’s new role – formally her title is the Associate Director of the Division of Corporation Finance and Senior Advisor for Digital Assets and Innovation for Division Director Bill Hinman – clearly place her on the heart of the SEC’s more and more centered efforts in opposition to crypto fraud, and Szczepanik’s CV actually signifies she is suited to the duty.
Szczepanik, who joined the SEC in 1997, most lately labored because the Commission’s Assistant Director within the Division of Enforcement’s Cyber Unit the place she headed the SEC’s Distributed Ledger Technology Working Group, co-headed its Dark Web Working Group and is a member of its FinTech Working Group.
So what is going to the crypto announcement from the US Federal authorities be subsequent week?