In last week’s Cabinet News and Views, we examined the U.S. regulators’ approach to the digital asset space, with a focus on the assertion of jurisdiction by the CFTC, the SEC, prudential regulators, state executive and legislative branches, and Congressional initiatives. This week, our focus shifts to enforcement − what actions the various regulators are taking in the digital asset space and what we can expect to see in the near future.
CFTC Enforcement Actions
Over the past few years, the CFTC brought a number of enforcement actions against participants in the digital asset markets using its regulatory authority over the U.S. commodity derivatives markets, which included allegations of running an unregistered swap execution facility (a “SEF”) and/or designated contract market (a “DCM”) and a derivatives clearing organization (“DCO”), failure to register with the CFTC as a futures commission merchant (an “FCM”), a commodity pool operator (a “CPO”) and/or a commodity trading advisor (a “CTA”), as well as fraud, market manipulation and some other charges. Some of those actions are discussed below. As the CFTC ramped up its enforcement efforts in this area, the amounts of civil monetary penalties imposed by the CFTC increased from nominal in early cases to tens and even hundreds of millions of dollars in more recent cases. Again, as noted above, CFTC’s enforcement actions relate to cases that are clear under the existing authorities, while there…
