The US Commodity Futures Trading Commission (CFTC) has taken strict action against three decentralized finance (DeFi) companies.
This latest development comes as the world of digital assets continues to attract attention, a focus that will also be explored at Benzinga’s upcoming Future of Digital Assets conference.
Opyn, Inc., ZeroEx, Inc.And Deridex, Inc. have all been charged by the CFTC for various violations, including failure to register as directed and facilitating illegal transactions.
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These costs are related to the companies’ use of blockchain-based software protocols, commonly known as DeFi, which operated similarly to trading platforms.
The CFTC’s enforcement has resulted in Opyn, ZeroEx, and Deridex being assessed civil monetary penalties of $250,000, $200,000, and $100,000, respectively.
In addition, they have been ordered to stop further violations of the Commodity Exchange Act (CEA) and related CFTC regulations.
“Somewhere along the way, DeFi operators got the idea that illegitimate transactions become legal when facilitated by smart contracts. They do not,” Ian McGinleythe CFTC Director of Enforcement said. “The DeFi space may be new, complex and evolving, but the Division of Enforcement will continue to evolve with it and aggressively pursue those who operate unregistered platforms that allow U.S. citizens to trade digital asset derivatives.”
The case against Opyn revolves around a facility that trades and processes swaps without the necessary registration.
Deridex faced similar charges, but was known for not taking steps to prevent US users from accessing their protocol.
The main problem of ZeroEx Inc. was trading in tokens that gave traders an approximately 2:1 leveraged exposure to assets such as Ether ETH/USD And Bitcoin BTC/USD.
In light of their cooperation during the Division of Enforcement’s investigation, the CFTC has recognized a reduction in civil monetary penalties for each respondent.
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