John Joy, Managing Attorney and founder of FTI Law in New York, discusses crypto regulation and the two regulatory agencies racing to regulate them…

Earlier this month, a digital currency based on the Netflix series “Squid Game” soared in value before collapsing dramatically as its promoters quickly pulled out their funds in what is known as a “rug pull.” The website promoting the cryptocurrency was only three weeks old and was littered with grammatical errors, tell-tale signs that it was a scam, and it is estimated that investors lost around $3 million USD. While the story has grabbed the headlines, it is nowhere near the largest crypto fraud. Back in 2013, an individual from Texas conned investors out of 700,000 Bitcoin in a Ponzi scheme that was shut down by the Securities and Exchange Commission (SEC). Valued at today’s prices, that 700,000 Bitcoin would have been worth an incredible $40 billion dollars.

Perhaps the reason why the Squid Game scam grabbed the headlines was not because of the dollar amount involved, but the fact that main street investors are now getting caught by crypto investment fraud. Much like the cons that penny-stock promoters are famous for, the rise of crypto investment fraud has made the area a prime target for regulation. There is no shortage of interested parties with both the Securities and Exchange Commission (“SEC”)  and the Commodity Futures Trading Commission (“CFTC”) vying for the role of the new crypto-sheriff in…

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