Hot Development: USA Goes After These 3 Altcoins! He was fined

US regulator CFTC accuses 3 major DeFi altcoin players of allowing illegal leveraged transactions...
 Hot Development: USA Goes After These 3 Altcoins!  He was fined
READING NOW Hot Development: USA Goes After These 3 Altcoins! He was fined

US regulator CFTC accuses 3 major DeFi players of allowing illegal leveraged transactions. The altcoin projects in question will each pay fines of over $100,000.

CFTC fined these 3 altcoin projects

The Commodity Futures Trading Commission (CFTC) accuses 3 DeFi protocols named Opyn, ZeroEx (0x) and Deridex of offering illegal leveraged trading. According to the regulator’s statement, these projects face a number of accusations for functioning as exchanges using Blockchain-based protocols and smart contracts.

The CFTC is calling on Opyn, ZeroEx, and Deridex to end these violations. It also forces each of them to pay fines of $250,000, $200,000 and $100,000 respectively. The companies agreed to these terms to resolve these charges.

“DeFi operators are legalizing illegal transactions through smart contracts,” said CFTC Executive Director Ian McGinley. But it shouldn’t be like this,” he said. However, we should point out that the CFTC follows 0x particularly closely.

The DeFi altcoin project had recently hired the director of LabCFTC. Jason Somensatto took up a position in the regulator’s fintech research division in 2021. He is currently Chainalysis’ head of policy in North America. The CFTC accuses all three companies of offering leveraged and marginal trading using cryptocurrency.

Background on the charges: CFTC cites them

The US regulator also publicly announced the practices of 3 DeFi altcoin projects, for which it imposed fines, in violation of the law. Some of the accusations against Opyn are as follows:

Opyn came to the attention of the CFTC by enabling illegal derivative trading through the Opyn Protocol and the oSQTH derivative token. The value of oSQTH was based on the Squeeth index created by Opyn, which determines the value of ether squared relative to the stablecoin USDC. Users could take positions by purchasing oSQTH tokens through Opyn’s website, or they could generate and sell oSQTH with ether collateral. However, the CFTC determined that these transactions amounted to illegal derivative trading and found that Opyn was executing these transactions without being a registered exchange. Therefore, Opyn was fined $250,000.

As we reported as Kriptokoin.com, it came to the fore with the investigation it launched against Binance in June. The regulator’s accusations against Deridex are as follows:

Deridex was found in the CFTC decision to have developed and implemented a website that enabled the trading of “perpetual contracts,” leveraged derivative positions, through the Deridex Protocol. These contracts are based on the relative value of STABL2 and another cryptocurrency. The CFTC decision states that these perpetual contracts are swaps and leveraged or margined commodity transactions and therefore can only be offered to retail users on a registered exchange in accordance with CEA and CFTC regulations.

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