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.

Vinyl Group, Australia’s only listed music company, has acquired the assets of London-based Serenade, a platform focused on digital and physical collectibles, in an equity-based deal valued at up to US$1.6 million. 

Vinyl launched its website last year, aiming to replicate the experience of “crate-digging” for records in digital form, CEO Josh Simons told Decrypt. The acquisition marks the group’s expansion into the UK and European markets while enhancing its offerings in the digital collectibles space. 

“The plan was always to expand Vinyl.com’s offering to include music merchandise, digital collectibles, and experiences that connect fans with creators, and the acquisition of Serenade was the next step in that process,” Simons said.

Under the terms of the deal, Vinyl has made an upfront payment of $553,000 in shares, with an additional $1 million in shares contingent upon revenue and earnings targets.

The deal was finalized over the weekend, with Vinyl notifying Serenade that due diligence requirements had been successfully met. Vinyl’s share price jumped more than 8% on the ASX on Sunday following the announcement, rising to a three-week high above $0.06.

The performance-related earn-out requires the combined business of Vinyl.com and Serenade to achieve $2.76 million in revenue and $345,000 in earnings before interest and taxes within 12 months of the acquisition.

Serenade, which operates a marketplace for both physical and digital collectibles, has previously supported over 200 global artists, including high-profile names such as Liam and Noel Gallagher, Muse, and Sum 41.

The company also has partnerships with major record labels, including Warner Music Group and Beggars Group.

Serenade operates on the Polygon blockchain, a layer-2 scaling solution for Ethereum. Its key product, NFC-enabled digital “Smart Formats” built atop Polygon’s infrastructure, has seen 56% month-on-month sales growth since its launch in January, the company claims.

NFC-enabled digital Smart Formats are physical collectibles embedded with Near Field Communication technology that link to a digital asset or experience, typically hosted on a blockchain. 

These formats allow users to access digital content, such as music, exclusive videos, or digital artwork, by interacting with the physical item through their smartphone or other NFC-enabled devices.

Serenade CEO Max Shand will join Vinyl Group under a full-time employment agreement. Shand will receive five million options, vesting in stages upon achieving specific performance goals as part of his incentive package.

Blockchain-based predictions platform Polymarket is seeking an additional $50 million in new capital amid potential plans to launch a token, The Information reported Monday.

Investors in the round will be issued token warrants, giving them the right to purchase tokens if Polymarket decides to launch them in the future, the outlet reported, citing anonymous sources.

It’s unclear whether the tokens will provide additional utility within the platform. Polymarket CEO Shayne Coplan did not immediately return a request for comment.

It follows the platform’s $70 million raise over two rounds this year, where it picked up $25 million in a Series A led by General Catalyst and an additional $45 million in Series B funding with participation from Ethereum co-founder Vitalik Buterin.

Polymarket has been riding high on U.S. election fervor this year, capturing nearly $1 billion in trade volume from those taking a punt on who will become the country’s 47th president.

Built atop the Ethereum and Polygon blockchain networks, Polymarket allows participants to buy and sell shares in different possible outcomes of real-world events. The price of one “share” in a prediction market ranges from $0.00 to $1, and its price correlates to its percentage chance of winning, or its “odds.”

While speculation on who will take the White House in November has helped fuel the platform’s recent surge in popularity, Polymarket also allows betting on pop culture, sporting, and other political events.

And traders are taking outsized bets this year, with total trading volume reaching its highest point on the platform last month, topping out at $472.8 million, according to one Dune dashboard.

Its popularity has led those within the Polymarket community to opine in recent weeks on the possibility of a token to help fund operations, as the platform does not currently charge users fees.

Traders have started altering their behavior in response to the speculation, attempting to artificially boost their trading volume in hopes of securing a larger airdrop reward, according to whales, or large traders, monitoring the activity, Decrypt previously reported.