Consensys Sued US SEC Due to Violation of Law

Bittime - Consensys faces a US SEC lawsuit over alleged violations of securities laws through its MetaMask service. Charging documents reveal non-compliance in registration as a broker-dealer, affecting the crypto industry significantly.

Consensys Digugat SEC AS

Consensys, a company known as a leader and innovator in the crypto asset industry, has been sued by the United States Securities and Exchange Commission (SEC) recently due to alleged violations of securities laws committed by the company through a service known under the brand “MetaMask” .

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Fill out the SEC Claim Document

According to the SEC's charging documents, Consensys has been developing and managing various services related to crypto assets since 2016. Although they presented themselves as industry leaders, the SEC alleged that some of the services they offered to customers actually served as intermediaries in securities transactions for retail investors as well as involved in the offer and sale of securities.

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SEC Allegations Against Consensys

Here are some of the related allegations:

• Not Registered as a Broker-Dealer: The SEC stated that Consensys had violated federal securities laws by not registering as a broker-dealer. This action removes very important protections for investors that are protected by law.
• MetaMask Swaps: Since October 2020, Consensys has operated as an unregistered crypto asset securities broker through the MetaMask Swaps service. Through this service, users can exchange crypto assets, but Consensys does not meet SEC registration requirements.
• MetaMask Staking: Since January 2023, Consensys also works as an unregistered crypto asset staking program and as an unregistered broker.

What is the financial impact like?

It is reported that Consensys, an unregistered broker, has raised more than $250 million through the above-mentioned activities. This large number shows how important this issue is to the SEC and the crypto industry as a whole. This case has had a significant impact on the crypto industry.

To ensure that crypto companies comply with securities laws, the SEC has increased their oversight. The SEC's commitment to protecting investors and maintaining market integrity is demonstrated by the lawsuit against Consensys.

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Conclusion

As the lawsuit filed by the SEC against Consensys shows, violations of securities laws have a significant impact on crypto businesses. Crypto companies must ensure that they comply with all applicable regulations to avoid adverse legal action. We will continue to monitor how this case develops and how it impacts the crypto market.

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