Cryptocurrency-related enforcement actions undertaken by the United States securities regulator significantly increased in the six months following the bankruptcy of cryptocurrency exchange FTX.
An analysis of press releases from the Securities and Exchange Commission (SEC) and news reports on its actions found that in the six months preceding FTX’s collapse — the SEC undertook approximately six enforcement actions.
In the six months after FTX’s bankruptcy on Nov. 11, 2022, SEC crypto-related enforcement actions jumped to at least 17, an estimated increase of 183% from the preceding period.
Graph showing the number of SEC enforcement actions in each six-month period relating to crypto.
The increased actions, including the recent ones taken against the two exchanges, has seen some observers suggesting the SEC is attempting to redeem itself for failing to police FTX.
On June 7, MarketWatch reported that Republican Representative French Hill said the recent crackdown was a “cover your ass” move from the regulator and SEC chair Gary Gensler. He was speaking at an event in Washington D.C. that day.
Hill claimed instead of Gensler “overseeing FTX” the SEC head was instead “out bashing Kim Kardashian because she’s promoted crypto on some Super Bowl ad,” and said:
“[Gensler] opened up this year, in 2023, with all these enforcement actions, I think it looks like [cover your ass] to me.”
Markus Thielen, the head of research and strategy at Matrixport and author of Crypto Titanspreviously told Cointelegraph he believes there’s an air of “embarrassment” for those who didn’t catch the issues at FTX.
Ripple CEO Brad Garlinghouse echoed the sentiment, claiming in a June 6 tweet that the SEC is “throwing lawsuits at the wall and hoping they distract from the agency’s FTX debacle.”
