Digital Assets
In the growing realm of digital assets, the prevalence of cryptocurrencies, such as Bitcoin and Ethereum, and non-fungible tokens (NFTs), has introduced novel avenues for both investment and fraudulent activity. These digital assets resemble conventional securities, making them susceptible to exploitation by fraudsters who convince potential investors with the promise of exorbitant returns and minimal risk. The proliferation of celebrity endorsements for cryptocurrencies has further exacerbated the issue, as investors may be unduly influenced despite explicit warnings from the Securities and Exchange Commission (SEC) that such endorsements hold no bearing on the trustworthiness of a particular cryptocurrency.
Crypto tokens and the exchanges that facilitate their trade can be categorized as securities by the SEC, commodities by the Commodity Futures Trading Commission (CFTC), or money services businesses by the Financial Crimes Enforcement Network (FinCEN). This jurisdictional overlap empowers whistleblowers with multiple avenues to report wrongdoing. They can choose to file a report with the SEC, the CFTC, or FinCEN, depending on the specific nature of the fraudulent activity they have uncovered.
