The U.S. Commodity Futures Trading Commission had filed charges against 14 crypto companies that had allegedly failed to register as futures commission merchants. The agency said 12 of the companies had not registered, while two of them had allegedly lied about being registered with the regulator.
The CFTC said 12 of the companies that failed to register with it are New York-based. The other two companies - Climax FX and Digitalexchange24.com - are based in Texas and Arkansas, respectively. The CFTC said the two companies made "false and misleading claims" of having registered as FCMs with it and the National Futures Association.
The independent agency of the U.S. government mainly regulates derivatives markets, including those that deal with futures, swaps, and specific types of options. The agency does not regulate spot commodity markets.
Following the rise in popularity of cryptocurrency trading, the CFTC has mostly been taking a backseat role in regulating the new type of digital currency when compared to the U.S. Securities and Exchange Commission.
Analysts said the latest move may indicate the CFTC's intention of taking a more active role in regulating the use of crypto in the derivative markets. The latest actions could likely lead to more charges being filed against crypto companies that have failed to properly register as FCMs.
On Wednesday, cryptocurrency exchange Kraken had agreed to pay $1.25 million to the CFTC to settle its case against it. The CFTC had accused the exchange of failing to register as an FCM as it continued to offer margined digital asset transaction services to its customers.
Apart from Kraken, the CFTC also previously filed charges against BitMEX. The agency alleged that BitMEX had been illegally offering customers in the U.S. leverages and unlicensed crypto products. To settle the civil case, BitMEX agreed to pay the regulator $100 million.
With the departure of one of its commissioners, Dan Berkovitz - who will be serving as the SEC's general counsel under Gary Gensler, the CFTC will be operating with only two commissioners. The CFTC normally operates with five commissioners. The remaining commissioners working at the regulator are Commissioner Dawn Stump and Acting Chairman Rostin Behnam.
