The U.S. Securities and Exchange Commission announced Thursday that it has charged Cumberland DRW, a Chicago-based crypto trading firm, with various securities charges.

In an announcement, the SEC said that Cumberland operated as an unregistered dealer in handling more than $2 billion worth of cryptocurrencies. 

The complaint alleges that Cumberland traded “crypto assets that are offered and sold as investment contracts on third-party crypto asset exchanges.”

The SEC complaint mentions five assets that the regulator considers to be securities, including Solana, Polygon, Cosmos, Algorand, and Filecoin. The complaint notes, however, that it is a “non-exhaustive” list of such assets.

“Despite frequent protestations by the industry that sales of crypto assets are all akin to sales of commodities, our complaint alleges that Cumberland, the respective issuers, and objective investors treated the offer and sale of the crypto assets at issue in this case as investments in securities,” said Jorge G. Tenreiro, Acting Chief of the SEC’s Crypto Assets and Cyber Unit (CACU), in a statement.

“Cumberland profited from its dealer activity in these assets without providing investors and the market with the important protections afforded by registration,” Tenreiro added.

Cumberland did not immediately respond to Decrypt’s questions, but posted a statement on Twitter (aka X) that it wouldn’t be “making any changes to our business operations or the assets in which we provide liquidity” due to the lawsuit. 

“We’re ready to defend ourselves again,” it added, referring to a 2018 lawsuit from the Commodities and Futures Trading Commission against DRW, which the investment firm won.

Cumberland is the crypto trading subsidiary of Chicago-based investment firm DRW. It specializes in making institutional-sized markets in Bitcoin and other digital assets.

The SEC has hit a number of digital asset firms—including major American exchanges Coinbase and Kraken—with lawsuits for allegedly selling unregistered securities in the form of cryptocurrencies. 

But the approach has attracted the ire of those in the industry and some U.S. politicians, who claim the regulator and its Chair Gary Gensler have adopted a “regulation by enforcement” approach to watchdogging the industry.

Edited by Andrew Hayward

Editor’s note: This story was updated after publication with additional details.

The Thai Securities and Exchange Commission (SEC) has proposed new regulations that would allow mutual and private funds to invest in digital assets in an effort to align with international developments and address growing interest from institutional investors.

A draft proposal, published on Wednesday, is seeking public feedback on revisions to the criteria for funds investing in digital assets.

The SEC is proposing to allow securities companies and asset management firms to offer services to large investors interested in diversifying into crypto-related products, such as exchange-traded funds. The regulator aims to align with international developments in digital assets and create more opportunities for investors to diversify their portfolios under expert management, it said.

It follows a surge in international interest and demand for US-listed Bitcoin and Ethereum ETFs, which were greenlit for trading in January and May, respectively.

The regulator noted that while Thai investors could already access crypto ETFs abroad, the current framework for mutual funds, which has been in place since 2015, has not kept pace with digital asset investing changes overseas.

“The SEC Office sees fit to adjust the criteria for accepting investment in digital assets to be consistent with international development,” a rough translation of the proposal reads.

Proposed rules would differentiate between high-risk assets, such as Bitcoin, and stablecoins, like Tether, designed to maintain a steady value.

Thailand’s SEC also emphasized the need for fund managers to exercise “fiduciary duty in selecting appropriate investment channels” and to manage associated risks.

The draft outlines limits on digital asset exposure for various fund types. Retail mutual funds would be restricted to a 15% allocation in crypto investments, while more sophisticated funds for institutional and ultra-high-net-worth investors would face no cap on exposure, though they must diversify to manage risk.

The SEC’s proposal also includes guidelines for the temporary holding of assets such as Bitcoin or Ethereum, capping the holding period to five business days for trading purposes. “Funds may need to hold crypto assets to buy, sell, or exchange digital assets,” the SEC said.

Public comments on the proposal will be accepted until November 8, with final regulations expected next year.

One of crypto’s most prominent advocates in Congress, House Majority Whip Tom Emmer (R-MN), has big plans for the industry should Republicans gain control of all branches of federal government in November.

However, he also appears convinced that cryptocurrency regulation is coming to the United States regardless of how the election shakes out.

“Regardless of the outcome, I expect you to see digital asset legislation start to move in both bodies,” Emmer told Decrypt at the Messar Mainnet conference in New York this week. “I think it is ‘when,’ not ‘if,’ regardless of who’s in charge.”

The third-highest-ranking House Republican ascribes much credit for this rosy outlook to recent changes in tune on both sides of the aisle in Congress. This spring, a substantial number of Democrats, including Senate Majority Leader Chuck Schumer, joined Republicans to vote to overturn an anti-crypto banking rule. Days later, 71 Democrats including Nancy Pelosi voted to pass FIT21, a key crypto market structure bill. 

Just last week, Emmer’s most senior adversary on the House Financial Services Committee, Maxine Waters (D-CA), told Punchbowl News that “crypto is inevitable.” Waters, for context, was a steadfast opponent of bills like FIT21 just months ago.

“That’s a momentous statement by Maxine,” Emmer said.

Why have so many Democrats changed their tune on crypto this year? Emmer thinks it comes down to electoral politics, and realizing that younger voters may be casting a ballot with crypto in mind.

“They saw that there’s this voting bloc, age 18 to 40, and [for] maybe one out of five of them… this is the issue they’re going to be voting on,” the congressman said. 

While Emmer is now confident that crypto legislation is more or less inevitable, he maintains that Republican “trifecta” control of the House, the Senate, and the White House in 2025 would likely bring those laws into effect more swiftly than a Democratic-controlled government might. 

If the Majority Whip was operating in such a dream scenario, he said he would prioritize three specific types of crypto-related bills for passage into law: a market structure framework like FIT21, his bill outlawing the creation of an American central bank digital currency (CBDC), and a bill to facilitate the creation of dollar-backed stablecoins anywhere in the world, so long as they meet certain criteria enforced by the U.S. Treasury Department.

Emmer thinks these laws, if enacted, would go a long way toward creating solid footing for American crypto firms and projects currently worried about regulatory uncertainty. The congressman balked, though, at the notion of going much further than such legislation.

“I have Republican colleagues in the Senate who [think] we’ve got to create a new regulatory department just to deal with crypto,” he said. “Be careful what you wish for. You do not want that.”

Edited by Andrew Hayward