The U.S. Securities and Exchange Commission (SEC) announces the listing of 9 digital crypto tokens as securities. These digital assets are AMP, RLY, DDX, XYO, RGT, LCX, POWR, DFX, and KROM. The complaint leads to the arrest of an ex-Coinbase employee under the accusation of wire fraud.
The SEC is officially terming specific cryptocurrencies as securities this time. Its complaint in question clarifies its current stance that most cryptocurrencies are securities.
Gurbir Grewal, director of the SEC’s Division of Enforcement says, “We are not concerned with labels, but rather the economic realities of an offering. In this case, those realities affirm that a number of the crypto assets at issue were securities, and, as alleged.”
The landmark charges emanate from insider trading charges against a former Coinbase product manager and two others. “Our message with these charges is clear: fraud is fraud is fraud, whether it occurs on the blockchain or on Wall Street,” specifies the SEC’s complaint.
Also read: Former Coinbase employees charged with Insider Trading
The SEC complaint dealt with each of the 9 tokens individually to address their interpretation as securities in the 62-page document.
In the complaint document, the SEC states, “Each of the nine companies invited people to invest on the promise that it would expend future efforts to improve the value of their investment.”
The Commodity Futures Trading Commission (CFTC) Commissioner, Caroline Pham, in a tweet, likened the development as a “striking example of ‘regulation by enforcement.”
Coinbase Global, though, clarified in a twitter thread that it refers the bad actors to law enforcement.
