SEC Regulatory Strike on Crypto: $7.42 Billion in Fines Since 2013 – Report
Date: 2024-09-13 Author: Oliver Abernathy Categories: CRYPTO PAYMENTS
The U.S. Securities and Exchange Commission (SEC) has stepped up its scrutiny of the cryptocurrency industry in recent years in an effort to increase transparency and enforce regulatory requirements.
According to a Sept. 11 report from Social Capital Markets, the SEC has levied a total of $7.42 billion in fines against cryptocurrency companies and individuals since 2013, with a staggering $4.68 billion collected in 2024 alone.
A Growing Wave of Fines
The SEC has significantly stepped up its enforcement of cryptocurrency companies and their executives in 2024.
In 2024, the agency levied $4.68 billion in fines, up 3,000% from 2023. However, the jump was driven by a single case: a $4.67 billion fine against Terraform Labs and its founder Do Kwon for securities violations related to the collapse of the TerraUSD (UST) stablecoin.
Despite only 11 administrative cases in 2024 (compared to 30 in 2023 and 21 in 2022), the average SEC fine for the year reached a record $426 million. The increase highlights the SEC’s shift toward smaller, larger fines in an effort to take action that sets a precedent for the industry.
Billions in Fines for Crypto Leaders
In addition to the landmark case against Terraform Labs and Do Kwon, the SEC has also levied significant fines against other major crypto companies.
In 2021, the SEC fined Ripple Labs $125 million, alleging that the company was selling XRP as an unregistered security. The case sparked a heated debate in the crypto community, as Ripple insisted that XRP was a digital asset and not a security. The SEC’s actions had an impact on the entire digital asset market, as other cryptocurrencies came under scrutiny.
Telegram Group Inc. was also fined $1.24 billion in 2019 for conducting an unregistered offering of its Telegram Open Network (TON) token. The SEC stepped in to stop the project, citing securities law violations. The case serves as a strong warning to other crypto projects looking to raise funds through token sales, highlighting the importance of regulatory compliance.
The SEC targets both companies and their executives
The SEC's actions have targeted not only companies, but also their executives.
Since 2020, the SEC has issued $5.08 billion in fines in the "company + individual" category, highlighting its focus on punishing both corporate entities and decision makers.
