Cornerstone Research, a consulting firm, recently released a report showing that a record number of enforcement actions related to crypto were brought by the US Securities and Exchange Commission (SEC) last year.
The report discovered that during the course of 2022, a total of 30 enforcement actions had been brought by the SEC.
Out of these 30, 24 of the litigation actions had happened in US federal courts, while six of them had been administration proceedings.
This was a rise in the number of litigations from the previous year, which had stood at 14. Cornerstone Research is based in San Francisco.
The litigation consulting company provides expert testimony and financial analysis to government agencies, corporations, and attorneys.
The database of the company provides details about the enforcement actions that the SEC has brought against crypto-related companies between January 1st, 2013, and December 31st, 2022.
14 of the 30 enforcement actions were brought against initial coin offerings (ICOs) and a fraud allegation was included in 57% of them.
Apart from that, the first-ever case of market manipulation and insider trading from the sale and purchase of crypto assets was also brought by the SEC.
This was against the brother of the former product manager of Coinbase Ishan Wahi. Nikhil Wahi had been sentenced last week for 10 months in prison for the role he played in the crypto insider trading scheme.
The agency brought a number of high-profile cases, including charges in February 2022 against BlockFi for not registering the sales and offers on its crypto lending product.
Simona Mola, the author of the report and principal at Cornerstone Research, said that SEC had increased its focus on crypto trading and lending platforms as well as DeFI platforms under Gensler.
Mola also said that the chairman of the SEC, Gary Gensler had asserted that time was running out for crypto companies to register themselves in order to be compliant.
The researcher said that this could see the Crypto Assets and Cyber Unit of the SEC bring more enforcement actions.
It has already expanded its workforce recently in order to investigate violations of the securities law in the crypto market.
The report further disclosed that 22 of the enforcement actions brought in 2022 alleged violations of the Securities Act via unregistered securities offerings.
There were also 15 actions that alleged unregistered security offerings as well as fraud. There were also four actions in which the SEC alleged failure of registering as a dealer, or broker under the Exchange Act.
There were also two separate actions in which Kim Kardashian and Ian Balina were charged by the SEC for failing to disclose that they had been compensated for prompting crypto projects.
The former had promoted the Ethereum Max (EMAX) token, while the latter had promoted Sparkster’s SPRK tokens.
Gensler has maintained that most cryptocurrencies need to be registered with the SEC because they are securities.