SEC ramps up hiring to combat cryptocurrency fraud
SEC's Crypto Assets and Cyber Unit has brought more than 80 enforcement actions, $2B in monetary relief
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The Securities and Exchange Commission is ramping up its fight against cryptocurrency-related fraud and cyber threats by expanding its staff.
The regulator's enforcement division is adding 20 new positions to its Crypto Assets and Cyber Unit, which will bring the size of the team to a total of 50 people. The new positions will include supervisors, investigative staff attorneys, trial counsels and fraud analysts in the SEC's Washington, D.C. headquarters, as well as several regional offices.
The expansion will allow the team to focus on investigating securities law violations related to crypto-asset offerings, exchanges, lending and staking products, decentralized finance platforms, non-fungible tokens (NFTs) and stablecoins.
The U.S. Securities and Exchange Commission (SEC) is ramping up its fight against cryptocurrency-related fraud and cyber threats by expanding its ranks to investigate more cases. Photographer: Andrew Harrer/Bloomberg via Getty Images (Photographer: Andrew Harrer/Bloomberg / Getty Images)
Since its creation in 2017, the Crypto Assets and Cyber Unit has brought more than 80 enforcement actions related to fraudulent and unregistered crypto-asset offerings and platforms, resulting in monetary relief totaling more than $2 billion.
In addition, the unit has brought numerous actions against SEC registrants and public companies for failing to maintain adequate cybersecurity controls and for failing to appropriately disclose cyber-related risks and incidents.
"The U.S. has the greatest capital markets because investors have faith in them, and as more investors access the crypto markets, it is increasingly important to dedicate more resources to protecting them," SEC Chair Gary Gensler said in a news release. "By nearly doubling the size of this key unit, the SEC will be better equipped to police wrongdoing in the crypto markets while continuing to identify disclosure and controls issues with respect to cybersecurity."
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The increased hiring at the SEC comes after Gensler, who has referred to the cryptocurrency market as the "Wild West", told the Senate Banking Committee in September that the agency could use "a lot more people" to help regulate 6,000 new digital projects.
Blockchain data platform Chainanalysis reported that cryptocurrency-based crime hit a new all-time high in 2021, with illicit addresses receiving $14 billion over the course of the year, up from $7.8 billion in 2020. Across all cryptocurrencies tracked by the firm, total transaction volume grew to $15.8 trillion in 2021, up 567% from 2020.