US SEC Targets Crypto Market Again, Revokes Securities License Of Crypto Lender
Highlights
- US SEC revokes Salt Blockchain's securities license due to non-compliance with reporting rules.
- SEC claimed that the crypto lender failed to file periodic reports since December 31, 2021.
- Regulatory action sparks concerns about SEC's regulatory overreach in the crypto market.
- Expert predicts increased enforcement actions by SEC near fiscal year-end.
The US SEC has once again targeted the digital assets sector, with the latest regulatory actions against crypto lender Salt Blockchain. The agency has revoked the securities license of the crypto lender, sparking discussions in the market. It’s worth noting that the regulatory body has received heavy backlash from the crypto community recently, claiming the regulatory overreach of the agency.
US SEC Revokes Salt Blockchain’s Securities License
The US SEC has recently disclosed in a report that it has revoked the registration of securities for Salt Blockchain. The move against the Delaware-based crypto lender comes as the firm failed to comply with legal report requirements, the report showed.
The order states that the company hasn’t filed periodic reports since December 31, 2021, which violates Section 13(a) of the Securities Exchange Act of 1934, along with other rules. Notably, this non-compliance with reporting requirements has led the agency to impose sanctions, ultimately revoking the firm’s securities license.
Meanwhile, Salt Blockchain had previously faced regulatory hurdles in 2020, but it appeared that the firm has resolved those issues. Besides, the company has even explored potential buyers at a point. However, the latest regulatory action highlights the firm’s ongoing compliance struggles.
Meanwhile, the revocation became effective on September 6, 2024, and marks a significant setback for Salt Blockchain as it navigates the regulatory landscape. Notably, the order showed that Section 12 (j) of the Securities Exchange Act grants authority to the agency to suspend to freeze a securities license if an issuer fails to maintain the legal requirements.
Crypto Market Remains On Edge
The SEC’s latest action against Salt Blockchain has stirred debates about the agency’s regulatory approach toward the crypto sector. Critics argue that the SEC’s enforcement strategy is too aggressive, potentially stifling innovation and growth within the digital assets market.
Many in the crypto community view these actions as part of a broader pattern of regulatory overreach. Notably, the agency has recently faced heavy criticism for issuing a Wells Notice against OpenSea, targeting NFTs.
In addition, Jake Chervinsky, Chief Legal Officer of VariantFund, noted that enforcement actions by agencies like the US SEC and CFTC could intensify as their fiscal year-end approaches on September 30. Chervinsky suggested that regulatory bodies often increase enforcement activities near fiscal deadlines to bolster performance metrics for budgetary reviews. In a recent X post, the CLO said:
“It’s typical in September to see a flurry of enforcement actions as they shore up their performance reports and budget requests for Congress.”
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