Although Bitcoin is not new, it has been around for a long time. However, the financial sector, governments and regulators still don’t understand how to deal with it. This was however a great area in the US. Many cryptocurrencies are the future of money, according to many fans, while critics and customers alike bow to Ether and Bitcoin.
Digital currencies are still primarily used for fraud, extortion and other illegal activities. The American federal authorities made a decision recently that could have wide-reaching implications. Wall Street Journal reported that U.S. Securities and Exchange Commissions (SEC) have joined forces to condemn the first case of insider trading in cryptocurrency.
An ex-Coinbase executive is charged with providing inside information to his brother and friend. The three men were charged with fraud. The SEC also filed a civil suit alleging that nine cryptocurrencies (including seven on Coinbase) are unregistered securities.
Strict Regulations for Cryptocurrencies
This could have profound consequences as the SEC’s success would mean that the entire crypto industry would need to comply with numerous legal obligations and other regulatory requirements. Brianna Wu, a crypto expert and software developer, explains everything in one place tweet
This means that crypto-scams like “rug pulls” could end up with criminal charges. In the case of insider trade, the prosecutor stated his agency’s position: “Our message is clear: Fraud is fraud is a crime, regardless of whether it is on the blockchain or Wall Street.”