decrypt.co
While bellwether Bitcoin did briefly drop below $60,000 ahead of the news, the world’s largest crypto has since found a footing, CoinGecko data shows.
Perhaps it's because there’s little to fear the SEC could win its case, Matt Hougan, chief investment officer at Bitwise, told Decrypt on Thursday.
“The crypto market has learned—from Ripple, Coinbase, Grayscale, and others—that well-funded companies have a pretty good chance if they are willing to argue with the SEC in court,” he said. “Cumberland has made it clear that they intend to fight these accusations. As such, I'm not surprised that the market has shrugged this off.”
On Thursday, the SEC charged the Chicago-headquartered crypto trading firm with various securities allegations. In its complaint, the regulator alleged Cumberland had traded “crypto assets that are offered and sold as investment contracts on third-party crypto asset exchanges.”
Yet parent DRW, to which Cumberland is its crypto arm, has already been down this path. In 2018, the Commodities and Futures Trading Commission sued the firm, alleging market manipulation.
The CFTC ultimately lost its battle, where the court sided with DRW after it was ruled the regulator had failed to “meet its burden of proof.”
The regulator also took aim at several high-profile cryptos on Thursday, including Solana, Polygon, Cosmos, Algorand, and Filecoin, alleging it considers those assets to be securities. The SEC alluded to many more but stopped short, saying it had presented a “non-exhaustive” list in its complaint.
Those assets appear to have held up, standing as the least affected cryptos over the last 24 hours, with traders seemingly unfazed.
In any case, as SEC Chair Gary Gensler’s position becomes increasingly tenuous under the weight of political pressure in Washington, some believe the agency’s top dog has little room left to run.
“There is no last-minute change of tact from Gensler's hostility towards the industry, and he is almost certainly in the last months of his role," Ryan McMillin, chief investment officer at crypto fund manager Merkle Tree Capital, told Decrypt.
“Whichever administration takes over, I don’t see a role for him at the SEC, and I think markets see it the same way,” he said.