- The SEC has sued Cumberland DRW LLC for trading over $2 billion in crypto assets without dealer registration.
- The SEC’s complaint names five assets as securities: SOL, POL, ATOM, ALGO, and FIL, noting that this is not an exhaustive list.
The U.S. Securities and Exchange Commission (SEC) has taken legal action against Chicago-based Cumberland DRW LLC, accusing the firm of operating as an unregistered dealer in cryptocurrency assets. Cumberland allegedly handled over $2 billion worth of crypto assets, which the SEC considers securities, without registering as required by federal securities laws. The SEC’s lawsuit, filed in the Northern District of Illinois, claims Cumberland has been conducting this unregistered trading since at least March 2018.
Cumberland is a well-known liquidity provider in the crypto space. It is the digital asset arm of DRW Holdings, a firm founded in 1992, recognized for its expertise in derivatives trading. The SEC emphasized in the document that laws designed to protect investors apply to all securities dealers. This includes those dealing in crypto assets.
SEC Labels Five Cryptos as Securities in Cumberland Case
According to the regulator, the firm operates Marea, a trading platform available 24/7. That allows over 1,500 high-net-worth individuals and organizations to trade crypto assets. This includes well-known participants in the crypto world.
Further, the SEC complaint identifies five assets it classifies as securities, including Solana (SOL), Polygon (POL), Cosmos (ATOM), Algorand (ALGO), and Filecoin (FIL). However, the complaint specifies that this is not an exhaustive list of such assets.
The SEC’s complaint accuses Cumberland of violating Section 15(a) of the Securities Exchange Act of 1934. That seeking penalties, including the return of ill-gotten gains, interest, and other financial penalties. In response, Cumberland stated that it had made sincere efforts to comply with SEC regulations and expressed frustration over the allegations.
However, this legal action marks another step in the SEC’s ongoing efforts to regulate the crypto market. Also, it aims to ensure companies follow proper registration procedures to protect investors.
Highlighted Crypto News Today
Trump’s World Liberty Financial to Raise $300M via New Token Sale
