According to a survey published by blockchain risk monitoring firm Solidus Labs, there has been a notable increase in the number of crypto-related enforcement actions in the United States in 2022. Both federal and state regulators have broken records in enforcement action.
In 2022, the four major U.S. federal agencies involved in enforcing cryptocurrency laws took 58 actions. This number surpassed the previous high of 40 recorded in 2020 and is up 65% from 38 actions seen in 2021.
Agencies — the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), the Financial Crimes Enforcement Network (FinCEN), and the Office of Foreign Assets Control (OFAC) — have all broken their previous records, with the exception of FinCEN. which held one action in 2022, compared to four in other years since 2013.
The SEC led the regulators in 2022 with 30 lawsuits, nine of which were civil lawsuits filed after the arrests, and some of which are ongoing. They earned $242 million in fines. The report noted:
“The SEC has announced 30 cryptocurrency-related enforcement actions in 2022, more than any other regulator we have identified in the world.”
The CFTC has completed 19 claims, up 73% from 11 in 2021. These cases account for 21.95% of the agency’s activity, which is also a record and comparable to the 4.76% share of cryptocurrency in SEC cases.
The eight OFAC cases increased from the previous record of five, with the Tornado Cash sanctions being the largest case. The report notes that activity on Tornado Cash dropped sharply following OFAC’s actions, despite industry resistance.
Related: 350 New ‘Scam Tokens’ Created Every Day This Year: Solidus Labs
The report also notes that FinCEN activity is likely to increase this year following the tightening of sanctions on Russia and the strengthening of the Treasury Department’s whistleblowing program. So far, all FinCEN activities related to cryptocurrencies have been in violation of the Bank Secrecy Act.
“The states are in a race,” the report says. In total, 112 promotions were held across the states in 2022, compared to 89 in 2021 and 52 in 2020. Sixteen states held their first shares, and eight broke their records. Another 11 states equaled their previous enforcement records, and 15 states did not break the record. The report does not explicitly state whether all 50 states have taken action.
Regulators in Texas and Alabama were the most active, each reporting six cases. The Texas Securities Board, which issued the first-ever government crypto-related executive order in 2017, is the state’s all-time leader with 59 actions, “four times more than the state’s next most active regulator, the Colorado Securities Division.” Securities and the Washington State Department of Financial Institutions.