Crypto Fraud Cases in California Highlights Crypto Regulations

Guest Author
October 2, 2022
2:30 pm

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Some crypto fraud cases in California, highlights the requirement for a regulatory crackdown on digital currencies.
Last month, DFPI issued desist and refrain orders to 11 entities for breaking California securities law.

As per the highlights by the California Department of Financial Protection and Innovation (DFPI), the allegations that they offered are unqualified securities, material misrepresentations and omissions to the crypto investors.

Crypto Regulation in California

California seems to behave carelessly, to set a crypto-specific business registration process for those who want to start their Crypto-centered business in the state. Also, the new industries which gather more international attention, as crypto, are capable of fraud.

The suggested framework was forbidden by the Governor, Gavin Newsom, as the resources required to establish and enforce such a framework would be prohibitive for the state. Although, this kind of compliance infrastructure is not employed yet. This further raised the concerns that regulatory authorities have related to the crypto industry.

🚨 Gavin Newsom has vetoed AB2269 (which would have introduced a “Bitlicense type” digital asset license requirement for crypto companies with CA customers). Good news for the industry 👏 pic.twitter.com/69hBkivwDE
— Hailey Lennon (@HaileyLennonBTC) September 24, 2022

We applaud Gov @GavinNewsom's veto of Assembly Bill 2269. By vetoing this bill, and remaining true to the spirit and intent of his EO, California’s status as a crypto innovation leader remains a shining example for the rest of the country.

Our statement: https://t.co/SEPJQtZYhu
— Blockchain Association (@BlockchainAssn) September 24, 2022

All the crypto frauds recall that while crypto is a unique and exciting industry for the public with increasing craze in the present time, but it still has an area that is very common with the potential for bad players and fraud.

The government still needs to toughen the crypto regulation to minimize any kinds of crypto fraunds. No matter what occupation you own, but if you want to be a part of this world then everyone must be assured of the after-effects and risk factors, that can cause financial loss.

It now became inevitable that California, known to be a first mover in regulation and compliance, make some form of crypto-specific compliance infrastructure in the name of consumer protection in the future.