Reviewing Nearly 5 Years of U.S. Crypto Enforcement Actions: 25 Companies Paid Close to $32 Billion in Settlements, with FTX and Alameda Accounting for the Largest Shares
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Reviewing Nearly 5 Years of U.S. Crypto Enforcement Actions: 25 Companies Paid Close to $32 Billion in Settlements, with FTX and Alameda Accounting for the Largest Shares
Over the past five years, cryptocurrency companies have paid $32 billion in settlements to U.S. regulators, with the largest being FTX and Alameda at $12.7 billion.
Navigating Web3 tides with focused insightsAuthor: Coingecko
Translation: Felix, PANews
Recently, Coingecko released a research report on U.S. cryptocurrency enforcement actions. The study analyzed monetary settlements reached between crypto companies and U.S. regulators in federal and state court cases from January 1, 2019, to October 9, 2024, excluding charges brought against individuals. Below are the details of the report.
Settlements Total Nearly $32 Billion, FTX and Alameda Account for Almost 40%
The largest cryptocurrency enforcement action by U.S. regulators targeted the bankrupt crypto exchange FTX and its affiliated trading firm Alameda, which together paid the biggest settlement to date—$12.7 billion. The litigation against FTX and Alameda was led by the Commodity Futures Trading Commission (CFTC), with the settlement announced in August 2024, less than two years after FTX’s collapse. Although this ruling does not include CFTC lawsuits against individual executives, the $12.7 billion will be used to repay FTX customers and creditors (approximately $11.2 billion).
The second-largest enforcement actions were taken against the bankrupt crypto lending platform Celsius ($4.7 billion), former industry leader Terraform Labs ($4.5 billion), and crypto exchange Binance ($4.3 billion). Notably, the mid-2022 collapses of Celsius and Terraform Labs marked pivotal events signaling the end of the bull market, ultimately contributing to FTX's downfall and triggering a new wave of regulatory scrutiny in the United States.
Binance’s settlement represents a landmark victory for U.S. regulators. While it ranks fourth in settlement amount, it is so far the only operating crypto company to pay a multi-billion-dollar penalty. In November 2023, the world’s leading crypto exchange agreed to plead guilty to resolve legal actions brought by multiple U.S. regulators, including the Department of Justice (DOJ), the Treasury Department, and the CFTC.
To date, U.S. regulators have initiated 25 major cryptocurrency enforcement actions, each involving settlements exceeding $10 million. In total, the highest settlement amounts collected by U.S. regulators from crypto firms have reached $31.92 billion.
Enforcement Actions Surge in Past Two Years, Over $19.4 Billion in Settlements This Year Alone
Of the 25 major U.S. cryptocurrency enforcement actions, 16 were settled within the past two years, reflecting intensified regulatory scrutiny since FTX’s collapse at the end of 2022. Specifically, U.S. regulators resolved eight lawsuits in 2023 totaling $10.87 billion—the highest annual total on record—and an increase of 8,327.1% compared to the previous year.
Since then, U.S. regulators have reached an additional eight settlements in 2024 worth $19.45 billion—nearly two-thirds of the total settlement value. With only months remaining in the year, 2024 has already seen a 78.9% increase in settlement amounts compared to 2023. Given no signs of reduced oversight over the crypto industry, 2024 may surpass last year in both the number and value of enforcement settlements.
Between 2019 and 2022, U.S. regulators secured eight cryptocurrency-related settlements. At the end of 2019, they reached the first major cryptocurrency lawsuit settlement with Block.one (now renamed B1), the company behind EOS. The U.S. Securities and Exchange Commission (SEC) settled with Block.one for $24 million.
In 2020, the SEC won two more significant crypto-related lawsuits: BitClave, an ICO issuer, settled for $29.34 million in May, while Telegram settled for $1.24 billion regarding its subsidiary TON Issuer’s Gram token offering. The $1.24 billion Telegram settlement included $1.22 billion in disgorgement of ill-gotten gains and $18.5 million in civil penalties.
During the 2021 bull market, U.S. regulators successfully carried out three enforcement actions against prominent industry players. Stablecoin issuer Tether reached a $18.5 million settlement with the New York Attorney General (NY AG) in February and later a $41 million settlement with the CFTC in October, asserting that USDT was fully backed by dollar-denominated assets. The CFTC also settled with Tether’s parent company, Bitfinex, imposing a lower fine of $1.5 million for illicit trading activities. Meanwhile, crypto exchanges Poloniex and BitMEX settled in August for $10.39 million and $100 million, respectively.
In 2022, cryptocurrency lending firm BlockFi reached a $100 million settlement with the U.S. SEC and the North American Securities Administrators Association (NASAA), while crypto exchange Bittrex settled with the Treasury Department for $29 million.
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