The US Securities and Exchange Commission (SEC) said Thursday that it has charged Cumberland DRW LLC, a Chicago-based firm, for operating as an unregistered dealer in in more than $2 billion of crypto assets.
Cumberland DRW Charged by SEC for Operating as Unregistered Dealer
The SEC alleges that Cumberland has been engaged in buying and selling crypto assets offered and sold as securities for its own accounts since at least March 2018.
According to the SEC, as part of its complaint, Cumberland acted as a dealer by trading crypto assets via its Marea online trading platform and by engaging in trading on third-party crypto asset exchanges.
“As alleged in the complaint, Cumberland publicly calls itself ‘one of the world’s leading liquidity providers’ in crypto assets and operates 24 hours a day, seven days a week by trading with counterparties by the telephone or through its online trading platform, Marea,” said the SEC.
They argue that Cumberland’s activities constitute a violation of the registration requirements of the federal securities laws.
“The federal securities laws require all dealers in all securities to register with the Commission, and those who operate in the crypto asset markets are no exception,” said Jorge Tenreiro, Acting Chief of the SEC’s Crypto Assets and Cyber Unit (CACU).
He added: “Despite frequent protestations by the industry that sales of crypto assets are all akin to sales of commodities, our complaint alleges that Cumberland, the respective issuers, and objective investors treated the offer and sale of the crypto assets at issue in this case as investments in securities, and Cumberland profited from its dealer activity in these assets without providing investors and the market with the important protections afforded by registration.”
