The U.S. Securities and Exchange Commission (SEC) announced a noteworthy financial milestone in 2024, with total fines reaching $8.2 billion, the highest in the agency's history. This achievement was largely driven by a $4.47 billion legal settlement with Terraform Labs and former CEO Do Kwon, related to the collapse of the blockchain ecosystem in 2022.
The annual report dated November 22 states that, excluding the enormous fine from Terraform Labs, the total amount the SEC collected reached only $3.72 billion, the lowest level since 2013. Of the total fines this year, the SEC has collected $2.1 billion from civil penalties and set a record with $6.1 billion in illegal profit restitution for harmed investors.
Chairman Gary Gensler, who will complete his term in January 2025, has affirmed that these results are evidence of the SEC's commitment to investigating and addressing violations based on facts and the law. Under his leadership, the SEC has maintained a tough stance on the cryptocurrency industry, filing 46 lawsuits last year and reducing that number to 11 this year. However, the fines from crypto-related lawsuits have surged, increasing by over 3,000% compared to the same period last year.
Gary Gensler will resign coinciding with Donald Trump's inauguration as President of the United States. This event has fueled hopes in the crypto industry that the new administration will bring about more friendly regulations. Trump had previously pledged to ease harsh enforcement measures, and legal experts such as Katrina Paglia of Pantera Capital predict that many of the SEC's lawsuits against cryptocurrency companies will gradually be withdrawn under the new administration.
Overall, 2024 has seen the historic success of the SEC in financial penalties, primarily thanks to its tough stance on the crypto industry. However, the direction of these oversight measures could change dramatically as the new administration begins its term.