It should be noted that the US authorities' attention to cryptocurrency platforms has been felt this week as well. In particular, last night it became known about the blocking of exchange Bitzlato and the arrest of its founder. According to the country's prosecutors, the platform was used to launder funds. And judging by the correspondence of the management, they understood perfectly well the reasons for the local popularity of their own exchange.

The platform itself was notable for the partial absence of an identity verification system, as it was also possible to buy a verified account. By the way, Bitzlato executives were also aware of this.

The arrest of cryptocurrency fraudsters

Who is against cryptocurrencies?

Generally speaking, the consulting firm Cornerstone Research provides financial analysis and expert opinions to lawyers, corporations and government agencies. It itself is based in San Francisco. The company’s database contains cryptocurrency-related lawsuits filed by the US Securities and Exchange Commission between January 1, 2013 and December 31, 2022.

Examiners have recorded 14 initiated proceedings against ICOs, i.e. initial coin offerings, during the year. Just over half of them are suspected of deliberately defrauding investors.

Statistics on SEC activity in previous years


As a reminder, an ICO is a form of investment attraction in the form of the sale of tokens obtained through an initial issuance to investors. ICOs boomed in 2017-2018, with IEOs reaching greater prominence during the 2021 bull run. We wrote about them in more detail in our previous article.

It is worth noting that many projects were hype on the popularity of ICOs. That is, they did not even plan to launch any working product, but successfully raised significant amounts of money. As a result, regulators took such companies seriously and managed to fine them, among other things.

According to Decrypt’s sources, in 2022, the SEC also launched its first-ever proceedings regarding insider trading in crypto. The case in question is that of Nikhil Wahi, brother of former Coinbase manager Ishan Wahi, who obtained information about the listing of tokens on the exchange in advance and profited from their pre-purchase.

Other high-profile Commission cases include allegations against the BlockFi platform and the former CEO of cryptocurrency exchange FTX, Sam Bankman-Fried. BlockFi’s management is suspected of failing to register lending services on its platform, and Bankman-Fried is being prosecuted over suspicions of defrauding customers of the bankrupt platform.

Report author and Cornerstone Research director Simone Mola commented on the information released.

Under Chairman Gensler, the Commission has increased its focus on cryptocurrency lending and trading platforms, as well as decentralised finance platforms.

SEC chief Gary Gensler

Furthermore, Mola believes that Gensler plans to further increase pressure on the crypto industry. This is also evidenced by his rather harsh comments on whether some cryptocurrencies should be recognised as securities.

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Sam Bunkman-Fried, mentioned in the firm’s report, has a direct connection to many in the US Congress: sources say Sam has donated to 196 US senators out of its 535 members. The FTX founder was previously thought to have only sponsored Democrats, but after the bankruptcy of the exchange it turned out that Republicans were also receiving donations, reports CryptoSlate.

Statistics on members of Congress who took donations from FTX

Coindesk journalists did their own investigation and tried to contact those whose political careers were funded by Sam. Of these, only 53 senators responded. Some 64 per cent said they had decided to donate the sums received to non-profit causes, while 38 per cent said they were holding on to the money and were waiting for instructions on how to return it. Five politicians have already been able to return the money to FTX.

Several campaign managers said they were disappointed with the exchange’s bankruptcy situation. It remains to be seen how officials will deal with the funding, which could be returned to FTX’s new management in the form of liquidators to compensate creditors for losses.

FTX founder Sam Bankman-Fried

All told, FTX CEO Sam Bankman-Fried has spent about $40 million on donations to Democrats in Congress since 2021, becoming the fourth-largest individual political donor in 2022. FTX co-CEO Ryan Salame has donated around $24 million to Republican Party candidates and causes. These donations make him the eleventh largest donor in the country.


We believe that the attention of SEC officials will remain high. For example, it was only in mid-January 2023 that SEC officials tentatively accused Gemini and Genesis of unregistered offerings and sales of securities to retail investors. Even so, SEC officials are often accused of being too slow to respond. Usually the agency's representatives deal with the guilty companies only after big problems have arisen.