The United States Securities and Exchange Commission (SEC) has received $4.68 billion in fines from 11 crypto-related entities.
According to a recent report, this record is the highest ever set in a year. Since 2013, the SEC has imposed over $7.42 billion in fines on crypto companies and individuals.
The 11 enforcement actions in 2024 resulted in an average fine of $426 million, significantly exceeding the average fines of previous years. The increase from an average fine of $3.39 million in 2018 to $426 million in 2024 highlights the escalating financial risks for crypto companies that do not meet regulatory requirements.
This year’s record far exceeds the totals from the previous two years, which were $308.9 million in 2022 and $150.26 million in 2023. This year’s fines reflect a 63% increase compared to last year’s.
The SEC has intensified its regulatory efforts in the crypto sector to promote transparency, safeguard investors, and ensure legal adherence. The report noted that these fines highlight the importance of complying with regulations as the crypto asset space grows.
Terraform Labs Bagged the Highest Fine
The report also revealed that Terraform Labs led this year’s record with nearly $4.5 billion in June. Additionally, the Singapore-based blockchain project and its co-founder, Do Kwon, received the largest fine ever issued by the SEC since 2013 for misleading investors and offering unregistered securities.
The fine was imposed after the project collapsed in May 2022, when Terraform Labs’ UST stablecoin lost its peg to the U.S. dollar and other related tokens experienced substantial devaluation. This led to a $45 billion reduction in the crypto market capitalization, critically affecting numerous crypto companies.
Telegram & Ripple Labs Not Left Out
Terraform Labs was not the only firm that received a fine from the SEC. The social media platform Telegram was fined $1.4 billion in 2019, the largest fine at the time. The agency fined the social app for illegally distributing TON crypto tokens via an initial coin offering (ICO).
The SEC also fined Ripple Labs $125 million for selling XRP as an unregistered security.
