{"id":96156,"date":"2024-10-10T18:18:27","date_gmt":"2024-10-10T22:18:27","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=96156"},"modified":"2024-10-10T18:39:35","modified_gmt":"2024-10-10T22:39:35","slug":"us-sec-sues-cumberland-drw","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/us-sec-sues-cumberland-drw\/","title":{"rendered":"US SEC Sues Cumberland DRW of $2B Unregistered Crypto Sales"},"content":{"rendered":"\n

US\u00a0SEC\u00a0has charged Cumberland DRW <\/a>with violating securities laws by transacting over $2 billion in crypto assets as an unregistered dealer.<\/p>\n\n\n\n

\"US<\/figure>\n\n\n\n

The U.S. Securities and Exchange Commission (SEC) has charged Chicago-based Cumberland DRW LLC with operating as an unregistered dealer in the crypto asset market. <\/p>\n\n\n\n

The SEC alleges that Cumberland carried out over $2 billion in crypto transactions that were sold as securities, without the required registration, thereby violating federal securities laws meant to protect investors.<\/p>\n\n\n\n

SEC Charges Against Cumberland DRW<\/h2>\n\n\n\n

According to the regulator's complaint, Cumberland has acted as an unregistered dealer \r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a>since at least March 2018 by buying and selling crypto assets classified as securities for its own account. <\/p>\n\n\n\n

The SEC claims Cumberland promotes itself as “one of the world's leading liquidity providers” and operates 24\/7 through both phone and its online platform, Marea.<\/p>\n\n\n\n

The agency argues that Cumberland\u2019s regular trading of crypto assets, considered investment contracts, on third-party exchanges makes it a securities dealer. <\/p>\n\n\n\n

Its failure to register, the SEC says, constitutes a violation of Section 15(a) of the Securities Exchange Act of 1934.<\/p>\n\n\n\n

SEC's Stance on Crypto as Securities<\/h2>\n\n\n\n

Jorge G. Tenreiro, Acting Chief of the SEC\u2019s Crypto Assets and Cyber Unit (CACU), underscored the requirement for crypto dealers to register with the Commission. <\/p>\n\n\n\n

He stated, \u201cThe federal securities laws require all dealers in all securities to register with the Commission, and those who operate in the crypto asset markets are no exception.\u201d<\/p>\n\n\n\n

Despite ongoing industry debates over whether digital assets should be treated as commodities, the SEC has consistently argued that many crypto assets fit the legal definition of securities. <\/p>\n\n\n\n

This case is part of the SEC\u2019s wider effort to enforce securities laws within the crypto sector.<\/p>\n\n\n\n

The complaint, filed in the U.S. District Court for the Northern District of Illinois, seeks permanent injunctive relief, disgorgement of profits, prejudgment interest, and civil penalties.<\/p>\n\n\n\n

Pushback from Ripple and Crypto.com<\/h2>\n\n\n\n

This case highlights the escalating tension between the SEC and prominent crypto firms. Ripple, which is currently embroiled in its own legal battle with the SEC, recently filed a cross-appeal<\/a> challenging the classification of its XRP token as a security. <\/p>\n\n\n\n

Ripple CEO Brad Garlinghouse commented on the SEC\u2019s action against Cumberland, tweeting, \u201cThe calls are coming from inside the house\u2026 Commissioner Uyeda calls the SEC\u2019s approach to crypto a disaster \u2013 and right on cue the agency sues @CumberlandSays for operating as an unregistered securities dealer. This circus needs to end.\u201d<\/p>\n\n\n\n

Ripple has made some progress in its case, with a recent ruling that some XRP sales were not considered securities. <\/p>\n\n\n\n

However, the SEC is expected to appeal, and Ripple's cross-appeal seeks to address all outstanding issues regarding XRP's classification as an investment contract.<\/p>\n\n\n\n

Additionally, Crypto.com has also filed a lawsuit against the SEC<\/a>, accusing it of overreach after the platform received a Wells notice indicating that certain tokens on its platform might be classified as securities. <\/p>\n\n\n\n

Crypto.com argues that the SEC is unlawfully expanding its jurisdiction by labeling nearly all crypto assets as securities.<\/p>\n","protected":false},"excerpt":{"rendered":"

US\u00a0SEC\u00a0has charged Cumberland DRW with violating securities laws by transacting over $2 billion in crypto assets as an unregistered dealer. The U.S. Securities and Exchange Commission (SEC) has charged Chicago-based Cumberland DRW LLC with operating as an unregistered dealer in the crypto asset market. The SEC alleges that Cumberland carried out over $2 billion in […]<\/p>\n","protected":false},"author":56,"featured_media":96173,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[7819,4288],"class_list":["post-96156","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-crypto-regulation-2","tag-us-sec"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2024\/10\/US-SEC-Accuses-Cumberland-DRW-of-2B-Unregistered-Crypto-Sales.jpeg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/96156","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/56"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=96156"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/96156\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/96173"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=96156"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=96156"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=96156"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}