At the end of April, the Financial Stability Oversight Council (“FSOC”) published for public comment two proposals that would make it easier for FSOC to designate nonbanks as systemically important financial institutions (“SIFIs”). The proposals, on which public comments are due by June 27, 2023, revise and reverse the designation approach taken during the Trump Administration and are in line…
I. Overview After many months of rapid-fire crypto-related enforcement actions from the SEC, April itself only had one notable complaint, which was filed against Bittrex. The most important development was not a complaint, but a Wells submission from Coinbase, the largest digital asset exchange in the United States. Coinbase released publicly its lengthy Wells submission, which calls out the SEC…
The Banking Group of Debevoise & Plimpton LLP has revised the name and expanded the scope of its blog, now titled “The Debevoise FinReg and FinTech Blog.” The revamped client tool will cover a broader range of regulatory topics impacting the financial sector, particularly in the wake of the recent failures of Silicon Valley Bank, Signature Bank and First Republic…
As previewed in our client update from April 26, 2023, three government agencies released reports reviewing the failures of SVB Financial Group (“SVBFG”) and Signature Bank (“SBNY”) on Friday. Specifically: the Federal Reserve Board (“FRB”) released a report on the failure of SVBFG and Silicon Valley Bank (“SVB”) led by Vice Chair for Supervision Michael Barr (the “FRB Report”); the…
The Silicon Valley Bank (“SVB”) and Signature Bank (“Signature”) failures (together, the “March Failures”) were the second- and third-largest commercial bank failures in U.S. history. Six weeks after the March Failures, bank stability issues continue to generate headlines, and healthy banks remain subject to depositor outflows.[1] The March Failures have raised broad-ranging questions regarding the proper calibration of U.S. bank…
I. Overview March 2023 included several important crypto-related enforcement actions and continued the trend of an active 2023 (which is showing no signs of slowing down in April). The Securities and Exchange Commission (“SEC”) brought an action to stop an alleged Ponzi-like crypto asset fraud scheme, charged eight celebrities for touting tokens without disclosing associated compensation, and continued to focus…
On March 22, 2023, the Securities and Exchange Commission (“SEC”) filed a complaint against Justin Sun and his related companies, which included claims that he made offers and sales of unregistered securities.[1] According to the complaint, Sun distributed two crypto tokens, TRX and BTT, which the SEC claims are unregistered securities. Unlike most prior actions alleging that tokens were sold…
I. Overview February 2023 was an active month for crypto-related enforcement actions. Enforcement agencies brought additional charges as part of the ongoing fallout of FTX. The Securities and Exchange Commission (“SEC”) brought another action against a celebrity for touting tokens, stopped a cryptocurrency-based investment scheme targeting vulnerable individuals, and brought charges against defendants for an alleged multi-billion dollar fraud involving…
Two months in and 2023 is set to be a big year for crypto enforcement. Fueled in part by the bankruptcy of FTX and other crypto-related companies in late 2022, regulators have begun to move past mainly rhetorical warnings regarding the crypto industry and to take a heavier hand. The SEC’s main claim has been for unregistered securities and exchanges,…
In a further response to the events over the past several months that have rattled the crypto industry, on February 23, 2023, the Federal Reserve Board (“FRB”), Federal Deposit Insurance Corporation (“FDIC”) and Office of the Comptroller of the Currency (“OCC”) (together the “Agencies”) issued their second joint statement (the “Statement”) in less than two months regarding crypto-asset-related risks. As…