On July 21, 2022, the Securities and Exchange Commission (“SEC”) filed an insider trading case alleging for the first time that an employee’s alleged tipping of material nonpublic information for purposes of trading crypto assets constitutes securities fraud.[1] Under this theory, the SEC’s complaint alleges that certain cryptocurrencies were securities under the Securities Act of 1933 and the Securities Exchange Act of 1934, because the SEC claims they were investment contracts based on the fact that they were (a) “offered and sold to investors”; (b) “who made an investment of money in a common enterprise,” and (c) “with a reasonable expectation of profits derived from the efforts of others.”[2] In contrast, the United States Attorney’s Office for the Southern District of New York (“SDNY”)—the tip of the spear in the U.S. Department of Justice’s prosecutions for insider trading—brought an indictment arising out of the same conduct alleging only wire fraud charges.[3] Unlike the...
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INN caught up with cryptocurrency investment expert Dan Hoover to review the current landscape and where the market may be heading. The cryptocurrency investment marketplace has gone through severa...