Scott H. Kimpel

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On December 1, 2021, Freddie Mac published Bulletin 2021-36 for Freddie Mac sellers to provide updated guidance on eligibility criteria for qualifying mortgages. Freddie Mac publishes such bulletins on a regular basis for loan originators who wish to resell mortgages to Freddie Mac, and Bulletin 2021-36 covers a number of routine topics such as 2022 conforming loan limits, certain credit underwriting criteria and document custody. The bulletin is notable, however, because it specifically addresses requirements related to cryptocurrency’s use in the mortgage qualification process.
Continue Reading Freddie Mac Addresses Cryptocurrency in Mortgage Lending Criteria

On November 23, 2021, the Senate Committee on Banking, Housing, and Urban Affairs sent a series of letters to prominent stablecoin issuers and cryptocurrency exchanges. Citing the recent President’s Working Group on Financial Markets report on stablecoins, the letters seek to clarify basic operational features of various stablecoins which the Committee believes is critical to improving its understanding of digital assets.
Continue Reading Senate Banking Committee Probes Stablecoins

In 15 recent enforcement actions, the Commodity Futures Trading Commission announced charges against various digital asset exchanges for failure to register appropriately as futures commission merchants. This series of actions is the latest in an ongoing regulatory crackdown across federal agencies involving cryptocurrency and other digital asset trading platforms.
Continue Reading CFTC Charges Crypto Platforms for Registration and Trading Violations

On September 13, 2021, New York Attorney General Letitia James announced the entry of a default judgment against crypto platform Coinseed and its CEO. The default judgment includes broad injunctive relief against Coinseed’s future operations in New York state. The case is one of many that regulators have recently brought against crypto trading platforms.
Continue Reading New York AG Obtains Default Judgment Against Crypto Platform

In a settled enforcement case announced August 9, 2021, the SEC fined Poloniex, LLC, a crypto trading platform, for operating an unregistered securities exchange. Then, on August 10, 2021, the CFTC and FinCEN announced a settled enforcement case against crypto exchange BitMEX for anti-money laundering violations and failure to register with the CFTC as a trading platform. The cases highlight US regulators’ increased focus on cryptocurrency exchanges.
Continue Reading Regulators Continue Crackdown on Crypto Exchanges

On July 20, 2021, New Jersey’s Acting Attorney General announced that the State’s Bureau of Securities issued a Summary Cease and Desist Order to stop BlockFi, Inc. from selling unregistered securities in the form of interest-bearing cryptocurrency accounts. While commentators frequently focus on the enforcement activities of the Securities and Exchange Commission in the crypto space, New Jersey’s action against DeFi platform BlockFi serves as a reminder that state securities regulators also actively police this marketplace.
Continue Reading New Jersey Orders DeFi Platform to Cease Offering Interest-Bearing Crypto Accounts

On May 11, 2021, staff in the Division of Investment Management (IM) at the Securities and Exchange Commission issued a statement (the Statement) on “Funds Registered Under the Investment Company Act Investing in the Bitcoin Futures Market.” The Statement provides a series of warnings to retail investors about certain risks associated with investments in registered mutual funds whose portfolios include Bitcoin futures. But the Statement also provides further insight into the way SEC staff analyze the market for Bitcoin Futures more broadly.
Continue Reading SEC Staff Issues Statement on Bitcoin Futures