The SEC has sent out similar subpoenas to at least two more crypto venture capital firms.
"It's a logical area for them to enforce further," mentioned a securities lawyer.
This year, the US Securities and Exchange Commission has subpoenaed no less than three crypto VC firms, according to someone close to the SEC's probe.
One of the subpoenas was labeled "regarding certain crypto asset offering intermediaries," based on the initial page seen by DL News.
"The staff at the United States Securities and Exchange Commission is carrying out an investigation related to the above-mentioned issue to see if there have been any violations of federal securities laws," the document stated.
The SEC isn’t slowing down. Anything offered to non-accredited investors that involves the right to hold tokens later is seen as a security by the SEC. But they’re not gonna focus on smaller projects while the big ones are still out there.
The SEC has not come up with any real charges against large or small companies and most cases end in compensation payments so they focus on large companies because they have a larger user base and greater access to profits while small companies will not be able to pay anything and the cases will drag on in court for years.
Eventually they will start messing up with small projects or they will bring in some regulation which will dismiss those small projects from being initiated. I can sense it for sure! What we are seeing is just at a very nascent stage right now. The scope and coverage, both will eventually increase if the current democrat government continues to rule after the election.
This might end if Trump wins the election and takes actions on his promises. Right now, US is the worst place to start a crypto business. Crypto VCs should look for better alternatives like Singapore or Dubai.
Are you sure the court cases will last for years?
Look at how much Ripple has spent in several years of litigation with the SEC and you will realize that litigation in the US is very expensive.
Any SEC interest in a small company will cause it to go bankrupt, because it will immediately lose all sources of funding, given the prospect of expensive litigation.
It is sad to see crypto businesses suffer due to strict regulations in the US. Looking at it from the customer protection point of view, one might see the need for such regulations. Some of these exchanges engage in a high rate of criminal activities just to ensure that they keep the business afloat. I am not against regulation of these exchanges but it becomes a problem when it is a conscious act by the SEC TO attack these companies. If the SEC's purpose for scrutinising these organisations is to raise funds from the government through fines, they might end up losing some viable business in the country. Many crypto firms will leave the US if this is a deliberate attack to exploit.
Litigation is not just expensive, it also affects the reputation and investor's (customers) confidence in the organisation. Investors will be sceptical about putting money in a setup which is having a legal battle with a regulator. An unfavourable court judgment can make them lose money.
I have read some articles on this an they always mention that the source is from dlnews.com. However, they never mentioned which of these VC firms are receiving the subpoenas which is very headshaking. My speculation on one of these VC firms might be Jump Crypto. They have been mentioned to be dumping Ethereum and other tokens quickly and this appears to be because it might be an emergency for them. On what this emergency might be, we cannot be certain.
Jump Crypto, the cryptocurrency arm of the Chicago-based proprietary trading firm Jump Trading, is transferring millions worth of digital assets to exchanges, which could be exacerbating selling pressure across crypto markets.
Data from blockchain analytics platform SpotOnChain indicates that in the past 24 hours alone, Jump Crypto has moved 17,576 ETH, or over $46.78 million, to exchanges like Binance, OKX, Coinbase, Bybit and Gate.io.
The latest transfers bring Jump Cryptos total exchange deposits to $277 million worth of Ether over the past 10 days.
Source https://thedefiant.io/news/markets/jump-crypto-appears-to-be-liquidating-millions-in-crypto
The SECs latest actions show its serious about enforcing compliance in crypto. By targeting these VCs, it's clear the agency is tightening its oversight. This could signal more stringent rules and a tougher environment for crypto projects ahead.
1. Read the anecdote. In the U.S., any president will not succeed in changing the situation. Securities laws have been around for a long time and the president can't change laws retroactively.
https://bitcointalk.org/index.php?topic=5505129.msg64392475#msg64392475
2.The US has very clear regulation and I've written about it
SAFT и SAFE(US)
https://bitcointalk.org/index.php?topic=5480233
You can't sell tokens in the U.S. the way many projects have since 2016.
However, where is the SEC's foundation for this compliance? It only appears that they are regulating the cryptospace through enforcement and tactics to cause fear, uncertainty and doubt. This is certainly why the judge in Ripple's case and I reckon another judge are ruling against the SEC's declarations. The judges are doing uncle Gary's job for him in making clarifications on what the companies in the cryptospace can do and cannot do hehehehe. This is headshaking and certainly very embarassing!
We can only speculate why Jump Crypto is dumping its assets. When the company's trading spokesperson was asked the reason for this dump, he responded that Jump Crypto don't discuss their wallet transactions and trading activity in public. Most traders would have expected that the firm should have been buying instead of selling, raising the suspicion that something might be wrong. The resignation of Kanav Kariya president of the crypto trading firm in June was the first red flag that all was not well with them. Your predictions that Jump Crypto is one of the firms subpoenaed might be correct considering the recent developments.
The SEC in the United States operates under the Securities Act (1933). The law is very old and does not correspond to modern realities, but there is no other law. Given the case law in the US, laws are shaped by court decisions, which no one can overturn.
"Dura lex, sed lex"(C)
@zasad@. Correct, however, under their laws a judge ruled that XRP and therefore other tokens are not by themselves illegal securities. This goes against uncle Gary's illegal securities on these tokens heheehe.
@Fiatless. There are speculations that Jump Crypto's dump on Ethereum and other cryptocoins were because the trading firm was having problems on their cashflow. This might also be because they need the cash to pay for lawyers' fees on a case against the SEC hehehehe.
"After a high-profile court battle, which included the unveiling of internal SEC emails detailing the inner workings of its approach to crypto, Torres issued a surprising decision in July 2023. She found that Ripples sales of XRP directly to institutional investors such as hedge funds violated securities laws, but secondary sales of the token on platforms such as exchanges did not."
https://fortune.com/crypto/2024/08/08/ripple-sec-crypto-xrp-appeal-court-decision-win/
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This case has been very long and complicated, and the court ruled that some tokens are securities and others are not.
I think there was a lot of backroom deals in this case, and that's why the judge had to make a decision to make both sides happy.
@zasad@. I reckon you misunderstood the case. Uncle Gary wants to declare them securities as issued by Ripple, however, they are not. The tokens by themselves do not have a contract or a promise of profit to the buyers. But securities laws were broken when Ripple offered them in private to investors. If XRP was sold in exchanges, this does not make it an illegal security which also acquits Coinbase from uncle Gary's case against them of being an exchange if illegal securities because XRP is not an illegal security.
That's where our opinions differ. You take this case literally, and I look at this court decision from different angles, because this decision also affects the big exchanges, which have their own beneficiaries, like Blackrock.
Speaking of sales, token advertising and general solicitation were strictly prohibited before, which violated US laws.
Before the regulation, many projects such as Solana, Near, Flow were essentially violating US law and the regulation process has only just begun.
However, the tokens by themselves are not illegal securities. The argument is securities laws were only broken if these tokens were sold through private deals, but if they were sold through the secondary market, this does not break securities laws. Uncle Gary is declaring that the tokens are illegal securities, the judge ruled that this is a mistake and these tokens are not illegal securities. This is also not according to your or my opinion. This is the judge's ruling.
Yes, that's why the SEC is trying to target the big platforms because the costs of litigation in the US are very expensive and most courts prefer to close cases with settlements, then they can settle things by paying cash or requesting customer data, so that SEC are more interested in the big platforms than in making real accusations.
If you collect enough data about your customers and cooperate with the authorities, they will likely overlook the negatives in exchange for cooperation.
Ashley is misleading. Let's go to wtm. The biggest profit right now is kaspa. We take the top ASIC KAS Miner KS5. We are lowering the price for electricity. We receive an income of around $40/day. x10 ~ $400/day x 21 days = 8400. Either the guys are from the future or Ashley is misleading.