The SEC Just Doubled Its Crypto Task Force In Major Fraud Crackdown Effort

cyber crime
The Securities and Exchange Commission (SEC) is beefing up its Crypto Assets and Cyber Unit in an attempt to protect crypto investors and further thwart cyber-related threats. The unit, formerly known as the Cyber Unit, is adding 20 positions to its cyber-crime fighting force.

The Crypto Assets and Cyber Unit has brought more than 80 enforcement actions related to fraudulent and unregistered crypto-asset offerings and platforms since its creation in 2017. Those actions have resulted in monetary relief totaling more than $2 billion, according to a press release from the U.S. Securities and Exchange Commission earlier this week.

"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," stated SEC Chair Gary Gensler. "The Division of Enforcement's Crypto Assets and Cyber Unit has successfully brought dozens of cases against those seeking to take advantage of investors in crypto markets."

Gensler added that by nearly doubling the size of the unit from 30 to 50 dedicated positions, the SEC will be better equipped to keep an ever-watchful eye on the crypto markets while continuing to identify disclosure and controls issues in regard to cybersecurity. The new positions will include additions to its supervisors, investigative staff attorneys, trial counsels, and fraud analysts in the agency's headquarters in Washington, D.C., as well as several regional offices.

bitcoin currency
The press release defines that the unit will focus on investigating securities law violations in the following areas:
  • Crypto asset offerings. 
  • Crypto asset exchanges. 
  • Crypto asset lending and staking products. 
  • Decentralized finance platforms. 
  • Non-fungible tokens. 
  • Stablecoins.
  Earlier this year two of the largest cryptocurrency-related thefts occurred. In February, hackers were able to steal $324 million from the blockchain platform Wormhole. Then in March, cyber-thieves were able to make off with $600 million from Axie Infinity's Ronin Network.

"Crypto markets have exploded in recent years, with retail investors bearing the brunt of abuses in this space. Meanwhile, cyber-related threats continue to pose existential risks to our financial markets and participants," added Gurbir S. Grewal in the press release. "The bolstered Crypto Assets and Cyber Unit will be at the forefront of protecting investors and ensuring fair and orderly markets in the face of these critical challenges."