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SEC fines in crypto surge to $4.7 billion in 2024

GrafaGrafa2024/09/16 05:30
By:Liezl Gambe

The U.S. Securities and Exchange Commission (SEC) dramatically increased its cryptocurrency enforcement actions in 2024, reaching $4.7 billion in fines, a massive 3,018% jump from $150.3 million in 2023. 

This surge, highlighted in a Social Capital Markets report, is driven mainly by fewer cases with larger penalties. 

The SEC's focus has shifted to imposing higher fines, averaging $426 million per case, compared to $14.71 million in 2022.

A significant factor contributing to the 2024 total is the record-breaking $4.47 billion settlement with Terraform Labs and its former CEO, Do Kwon, following the collapse of TerraUSD (CRYPTO:UST). 

This marked the largest enforcement action in SEC history and addressed issues like investor deception and unregistered securities offerings. 

The total $4.68 billion in fines for 2024 encompasses various penalties, including forfeiture, disgorgement, civil fines, settlements, and prejudgment interest.

Despite a reduction in enforcement cases from 30 in 2023 to 11 in 2024, the SEC's strategy reflects a clear shift toward impactful actions that set industry-wide precedents. 

"This trend indicates a strategic shift by the SEC toward fewer but larger fines," the report states, emphasising the agency's intent to focus on high-impact cases.

Other significant fines in 2024 included those against GTV Media Group and fraudsters John and Tina Barksdale, each exceeding $100 million. 

Since 2013, the SEC has issued over $7.42 billion in crypto-related fines, with 63% of that total occurring in 2024 alone.

Most penalties were substantial, with 46% of fines exceeding $1 billion. 

Penalties ranged from $1 million to $10 million for smaller firms and went below $1 million for minor infractions, reflecting ongoing scrutiny across the cryptocurrency sector.

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