CFTC Targets DeFi | Another FTX Exec Pleads Guilty

Three platforms were fined in U.S. derivatives regulator’s enforcement action.

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Nina Bambysheva Senior Reporter, Forbes Money & Markets
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Steven Ehrlich Director, Forbes Digital Assets
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CFTC GOES AFTER DEFI PLATFORMS

The U.S. Commodity Futures Trading Commission filed and settled charges against three decentralized finance firms Thursday. The agency alleged that Opyn, ZeroEx and Deridex illegally offered leveraged and margined retail commodity transactions in digital assets and ordered the firms to cease and desist from violating CFTC rules. It also required the companies to pay civil penalties of $250,000, $200,000 and $100,000, respectively.

The action was met with opposition from Summer Mersinger, a Republican commissioner, who issued a dissenting statement, saying the regulator “is taking another step down the path of bringing enforcement actions when [it] should be engaging with the public” and called the cases “concerning in that they represent a significant shift in position on the merits of engagement with DeFi market participants.”

ANOTHER FTX EXECUTIVE PLEADS GUILTY

Ryan Salame, the former co-chief executive of FTX’s Bahamas subsidiary, pleaded guilty Thursday in New York federal court to campaign finance and money-transmitting charges and agreed to forfeit more than $1.5 billion.

Unlike three other former executives who pleaded guilty in the case, Salame is not expected to testify against FTX founder Sam Bankman-Fried, who is set to face trial over the collapse of his cryptocurrency empire next month.

CURRENT PRICE OF TOP 5 COINS (7-Day % Change)

Coin

Price

Percent Change

Bitcoin (BTC)

$25,785

1.3%

Ether (ETH)

$1,628

1.4%

Tether (USDT)

$1

0%

Binance Coin (BNB)

$214

1%

XRP (XRP)

$0.5

2%

Source: Forbes Digital Assets. Prices as of 2:44 p.m. on September 8, 2023.

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CATHIE WOOD’S ARK AND VANECK FILE FOR FIRST SPOT ETHER ETF

Crypto exchange-traded-products issuer 21Shares in tandem with Cathie Wood’s ARK Investment Management and VanEck are seeking to offer the first U.S. exchange-traded fund that invests directly in ether, according to Cboe BZX Exchange’s Wednesday filings with the U.S. Securities and Exchange Commission.

The two applications mark the start of a 240-day countdown for the SEC to issue a decision on each filing and come amid the race to win approval for the first U.S. spot bitcoin fund. Regulators rejected numerous such applications over the past decade, citing concerns about fraud and price manipulation.

G20 ADVISED TO KEEP CRYPTO BUT ON A LEASH

Cryptocurrencies have yet to prove themselves anywhere near as useful as proponents claim and can be dangerous to the world’s financial system, but they should be controlled rather than banned, global financial regulators said in a new report.

At the request of India, which holds the presidency of the Group of 20 leading industrial and developing economies, previous recommendations from the International Monetary Fund, the Financial Stability Board and other standard-setting bodies have been combined into a list of suggested actions for national governments to accommodate digital currencies while protecting against the risks they pose. Read more about their key proposals.

Also: IRS’s New Crypto Tax Rules Pose A Threat To DeFi

ELSEWHERE

The Founder Of A Failed Crypto Exchange Was Sentenced To 11,000 Years In Prison

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