US SEC Drops Case Against Cumberland DRW in Crypto Securities Dispute
The U.S. Securities and Exchange Commission (SEC) has agreed to drop its enforcement case against Cumberland DRW, a Chicago-based crypto trading firm. The lawsuit, filed in October 2024, accused the firm of operating as an unregistered securities dealer and selling over $2 billion in unregistered securities.
US SEC Withdraws Charges Against Cumberland DRW
In a recent filing, the US SEC agreed to drop its enforcement case against Cumberland DRW. The decision is pending approval from most of the commission’s three-panel members. The agency had previously accused the firm of acting as an unregistered securities dealer.
The lawsuit, filed in October 2024, alleged that Cumberland DRW sold more than $2 billion in unregistered securities. The SEC named several tokens, including Polygon (POL), Solana (SOL), Cosmos (ATOM), Algorand (ALGO), and Filecoin (FIL), as securities. The firm had denied the allegations and stated it had attempted to comply with regulatory requirements.
Following the announcement, Cumberland DRW released a statement expressing its commitment to regulatory dialogue. The firm emphasized its dedication to integrity and transparency in the evolving financial landscape.
The crypto trading platform added,
“As a firm deeply committed to the principles of integrity and transparency, we look forward to continuing our dialogue with the SEC to help shape a future where technological advancements and regulatory clarity go hand in hand, ensuring that the U.S. remains at the forefront of global financial innovation.”
Enforcement Reversal Under New Leadership
The decision to drop the case against Cumberland DRW follows a series of abandoned enforcement actions by the US SEC. Since Acting Chair Mark Uyeda took office, the agency has withdrawn cases against multiple crypto firms. These include Coinbase, ConsenSys, and Kraken lawsuit.
The SEC has also closed investigations into several companies, including Gemini, OpenSea, Robinhood Crypto, and Yuga Labs. These reversals indicate a shift in the agency’s approach to crypto regulation. The case against Cumberland DRW was one of the key enforcement actions initiated under previous SEC leadership.
Meanwhile, the Securities and Exchange Commissioner Hester Pierce revealed members of the newly formed Crypto Task Force. The 15-member team includes key officials such as a Chief of Staff, Chief Counsel, Chief Policy Advisor, and Chief of Operations, alongside 10 senior advisors from various SEC divisions. Pierce emphasized that the task force will focus on developing practical solutions for crypto regulation.
Regulatory Adjustments in Crypto Enforcement
The US SEC’s decision to drop the case against Cumberland DRW marks another shift in its stance on crypto regulation. The agency’s previous enforcement actions had drawn criticism from industry leaders and legal experts. Under the new leadership, the US SEC appears to be reconsidering its strategy toward digital assets.
More so, the continued legal actions and settlements by the U.S. SEC have led to speculation that the commission might be nearing a resolution in the Ripple lawsuit. With recent cases against other crypto firms being dropped, industry observers believe the SEC may reconsider its stance on XRP. Ripple awaits the SEC’s decision by April 16, 2025, as the broader crypto market monitors the case impact.
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