- The SEC has sued virtual currency trading company Cumberland DRW.
- Cumberland State said it would defend itself from the charges.
- Gary Gensler, the SEC chairman and crypto opponent, has become a flashpoint in the presidential race.
The Securities and Exchange Commission on Thursday filed charges against Chicago-based cryptocurrency firm Cumberland DRW, accusing it of operating as an unregistered broker when selling Solana and Polygon tokens, among others.
Since 2018, Cumberland has handled “over $2 billion in crypto assets offered and sold as securities,” the SEC alleged.
The regulator wants Cumberland to be stripped of “all illegal trading profits” and pay a fine.
Cumberland State said it would defend itself from the charges.
In a statement shared with ” he said.
SEC Chairman Gary Gensler has become a hot topic in the upcoming presidential election, in part because of the agency's aggressive stance on cryptocurrencies.
More than half of the SEC's crypto-related enforcement actions since 2015 took place during Gensler's three-year term, according to crypto venture capital firm Paradigm.
Targets include not only startups but also the world's largest exchanges such as Coinbase and Binance.
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Gensler has long argued that most cryptocurrencies fall under the 90-year-old Securities Act, which regulates stocks and bonds. He argued that many issuers are breaking the law by not registering their tokens as securities.
Cryptocurrency companies and entrepreneurs are fighting back, preemptively suing the SEC in hopes that the courts will side with them and declare their activities legal.
Republican presidential candidate Donald Trump has vowed to fire Gensler if elected. His opponent, Democratic Vice President Kamala Harris, reportedly told Treasury executives that she intended to do the same.
SEC Commissioner Mark Ueda, one of two Republicans on the five-member commission, denounced Gensler's tenure as a “disaster” on Fox Business Thursday.
Cumberland said in a statement that it had “considered the situation in good faith with the SEC for five years” regarding the crypto situation, suggesting it had been blindsided by the lawsuit.
“Despite frequent protests by the industry that all sales of crypto assets are akin to sales of goods, our complaint confirms that Cumberland, their respective issuers, and objective investors are “We allege that we treated the offering and sale of the crypto assets at issue as an investment in,” Jorge G. Tenreyro, acting head of the SEC's Crypto Assets and Cyber Division, said in a statement. .
“Cumberland profited from dealer activity in these assets without providing investors and the market with the important protections afforded by registration.”
alex gilbert is DL NewsDeFi correspondent based in New York. you can contact him aleks@dlnews.com.
