SEC listing 9 tokens as securities in insider trading case ‘could have broad implications’ CFTC

Caroline Pham, one of the five Commissioners of the US Commodity Futures Trading Commission (CFTC), is concerned about the potential impact of a lawsuit filed by the Securities and Exchange Commission (SEC) against former Coinbase product managers. I have stated.

Fam in Thursday’s statement Said The SEC’s complaints against former Coinbase product manager Ishan Wahi, his brother Nikhil Wahi, and associate Sameer Ramani are cases, given that they label nine tokens as “crypto assets” under the jurisdiction of the regulatory body. Beyond “may have a wide range of impacts”.Complaints Alleged Wahis and Ramani explained which tokens to list on the exchange for pre-purchase by conducting insider trading using sensitive information Ishan obtained from Coinbase.

Specifically, the SEC is Powerledger (POWR), Kromatika (KROM), DFX Finance (DFX), Amp (AMP), Rally (RLY), Rari Governance Token (RGT), DerivaDAO (DDX), LCX, and XYO I referred to 9. The trio reportedly used it to earn $ 1.1 million in securities out of 25 different cryptocurrencies. “Through a transparent process that involves the public to incorporate expert opinion and formulate appropriate policies,” Fam said, SEC’s actions do not treat the issue of a particular crypto asset as a security. He said it constitutes an example of “enforcement regulation”.

Regulatory clarity comes from being outdoors, not in the dark, Fam said. “Given the highest priority public interest and open questions regarding the legal status of various digital assets, such as certain utility tokens and DAO-related tokens, the CFTC has a statutory obligation to proactively enforce the law. You must use all available means to fulfill. We support the Commodity Exchange Act. “

Read my statement above #SEC v. Wah, enforcement regulation & #CFTC authority #crypto #digitalassets #DAO pic.twitter.com/xbHvyshx8l

Caroline D. Fam (@CarolineDPham) July 21, 2022

Thursday update to April blog post from Coinbase on case Alluded to With similar concerns, the SEC accusation is called an “unfortunate distraction.” The Federal Law Office for the Southern District of New York also filed an indictment in parallel with the SEC proceedings, but did not. label Use any of the relevant tokens such as Tribe (TRIBE), Alchemix (ALCX), Gala (GALA), Ethereum Name Service (ENS), POWR, XYO as securities.

“DOJ did not claim securities fraud. The assets listed on our platform are not securities,” the company said.

SEC Executive Director Gurbir Grewal argued that the proceedings against Wahis and Ramani were based on the “economic reality of the offering” and that some of the crypto assets used were securities. Regulators said they were seeking permanent injunction relief, injustice, and civil punishment.

Related: CFTC labels 34 cryptocurrencies and forex companies as unregistered foreign companies

The CFTC and SEC often claim overlapping jurisdictions when it comes to regulating US digital assets and label them as either commodities or securities based on their respective institutions. In June, Senators Cynthia Lummis and Kirsten Gillibrand submitted a bill aimed at providing regulatory clarity to the space, giving the CFTC “clear authority over the applicable digital asset spot market.” Gave. However, Mr. Lumis said in an interview Tuesday that the law “is likely to be postponed until next year.”