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SEC nearly doubles staff to crack down on crypto abuses

Yahoo Finance’s Jennifer Schonberger joins the Live show to discuss the SEC nearly doubling its staff count to police wrong-doing in crypto markets.

Video Transcript


JULIE HYMAN: Let us get a check on cryptocurrencies right now. When I looked earlier, we were seeing a mixed picture for-- not that much movement, if you will. And we still got Bitcoin that is holding below $40,000. But of course, the backdrop for cryptocurrencies has a lot to do with regulation. And the Securities and Exchange Commission is beefing up its staff to protect investors in the crypto markets from cyber attacks, which have increased by a whopping 516 since 2020-- that's according to Chainalysis. Joining us now, Yahoo Finance's Jennifer Schonberger with the details on this. I mean, that is an incredible number.

JENNIFER SCHONBERGER: Sure is, Julie, that's right. The Securities and Exchange Commission beefing up its personnel to protect investors in crypto markets and against cyber attacks. The SEC is adding 20 investigators to its newly renamed Crypto Assets and Cyber Unit-- formerly the Cyber Unit-- nearly doubling the staff count to 50. The action is the latest in the SEC's aggressive push to police wrongdoing in crypto markets. SEC chair Gary Gensler says, quote, "as more investors access the crypto markets, it's increasingly important to dedicate more resources to protecting them."

The Division of Enforcement's Crypto Assets and Cyber Unit has successfully brought dozens of cases against those seeking to take advantage of investors in crypto markets. Now the unit will focus on policing crypto asset offerings, crypto exchanges, crypto lending products, decentralized finance platforms, NFTs, and stablecoins. The SEC has already been looking at crypto products, as well as how to regulate cryptocurrency trading exchanges. Gensler has encouraged crypto firms and exchanges to register their products and services with the commission, warning that the SEC could bring enforcement action if firms do not comply.

The SEC has brought 80 enforcement actions over the past five years against crypto, including a $100 million charge against BlockFi earlier this year for failing to register its retail crypto lending product. Now Julie, crypto crimes are ballooning. Crypto theft hit a whopping $3.2 billion last year. According to Chainalysis, that's up more than 500-fold from 2020. So Julie, Gensler certainly looking to try to rein in what he calls the Wild Wild West of crypto. Back to you.