SEC Sues Cumberland DRW Over $2 Billion Unregistered Crypto Trades, Alleges Solana and Polygon Are Securities

Oct 10, 2024, 05:12 PM

The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against Chicago-based Cumberland DRW LLC, one of the largest crypto market makers, alleging that the firm operated as an unregistered dealer in crypto asset transactions. The SEC claims that Cumberland traded over $2 billion in cryptocurrencies—including Solana (SOL), Polygon (MATIC), Algorand (ALGO), Cosmos (ATOM), and Filecoin (FIL)—which the agency considers securities, without proper registration. Cumberland DRW, which asserts that it acts as a liquidity provider, has stated it is not making any changes to its business and is prepared to defend itself against the SEC's allegations. This lawsuit marks the first time the SEC has targeted a major over-the-counter crypto trading firm and represents an expansion of the agency's crackdown on digital currencies and unregistered crypto trading operations.