SEC's Vigorous Year In Crypto Enforcement: Gary Gensler Vows To 'Prevent Future Wrongdoings'

The Securities and Exchange Commission (SEC) has had a notably active and effective year in enforcing actions related to cryptocurrencies and digital assets.

What Happened: The SEC Enforcement Division Director Gurbir S. Grewal stated, “Whether it was by leveraging risk-based initiatives, seeking robust remedies, rewarding cooperation, protecting whistleblowers, or returning nearly a billion dollars to harmed investors, the Enforcement Division stood up for the investing public.”

In the fiscal year 2023, the SEC initiated 784 enforcement actions, marking a 3% increase from the previous year. It also imposed $5 billion in financial remedies, the second-highest in its history, and distributed approximately $1 billion to investors who were harmed.

On Wednesday, the SEC announced that it has deferred its decision on two cryptocurrency-related ETF applications.

Also Read: BlackRock Eyes Ether ETF, Sparks Crypto Market Surge, Investor Optimism

The actions encompassed charges against various crypto firms and individuals, ranging from Coinbase and Sam Bankman-Fried to Terraform Labs and its founder Do Kwon. High-profile individuals like TV star Kim Kardashian were also charged for promoting crypto assets on social media without disclosing the payments received. Kardashian settled the charges by agreeing to pay $1.26 million.

Crypto companies such as Celsius, Kraken, Genesis Gemini, and Nexo faced penalties; Kraken and Nexo paid civil penalties of $30 million and $22.5 million, respectively. Exchanges Bittrex, Binance, and Beaxy were also a part of SEC’s focus.

The NFT space also saw some hits as the SEC charged Impact Theory LLC and Stoner Cats 2 LLC for conducting illegal, unregistered offerings of crypto asset securities.

The SEC also saw a record year for its Whistleblower Program as it gave out $600 million in whistleblower awards, the highest ever awarded in one year. It received more than 18,000 whistleblower tips in FY23 which is 50% more than the record 12,300 whistleblower tips in FY22.

“So what does this all mean? It means that the SEC is hard at work on your behalf. We have and will continue to prevent future wrongdoings, hold accountable those who try to game the system, and protect investors so that our markets remain robust, dynamic, and fair to all,” SEC Chair Gary Gensler said in a statement.

Separate Developments: In other news, Fortune reported challenges faced by the SEC in hiring crypto experts amid a broader industry downturn and increased enforcement actions following events like the FTX collapse and the Gemini Genesis case.

Now Read: South Korea's NPS Purchased Stake In Coinbase For $20M, Yields About 40% Profit

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