State and federal crypto and NFT-related enforcement actions continue to occupy the regulatory landscape with an apparent uptick coinciding with the issuance of The White House’s Executive Order in March (we discussed the Biden Executive Order here). The following are some enforcement actions from state and federal regulators since the Executive Order.
- On March 8, the CFTC charged four individuals with fraud for operating a bitcoin Ponzi scheme on the basis that bitcoin is a commodity subject to the CFTC’s enforcement jurisdiction. The defendants allegedly fraudulently solicited more than $21 million of bitcoin by promising potential investors that professionals traders would manage their bitcoin portfolios, guaranteeing trading profits to be paid daily. Instead, the defendants misappropriated customers’ bitcoin or used it to pay alleged profits to customers that had signed up earlier.
- Also on March 8, the SEC charged two defendants with defrauding retail investors out of more than $124 million through unregistered securities offerings involving a digital token created by the defendants. The defendants allegedly sold the token through subscription packages solicited to investors on crypto trading platforms and falsely claimed the token was backed by a $250 million crypto mining operation producing $5.4 million to $8 million per month in mining revenues. The defendants also allegedly falsified a website to display a fake wallet containing more than $190…
