DeFiSep 10, 2023

The CFTC has initiated regulatory actions against three DeFi protocols

The American regulator has hit several popular projects in the decentralized finance sector.

The U.S. Commodity Futures Trading Commission (CFTC) has recently initiated regulatory actions targeting three DeFi protocols. These include companies such as Opyn, ZeroEx and Deridex. This regulator has decided to accuse all these projects of failing to register various financial derivatives trading offers.

CFTC Strikes Three DeFi Protocols

Recent actions by US financial regulators have gone beyond centralized digital currency platforms. According to the latest statement issued by the CFTC, the body has accused decentralized finance protocols of failing to comply with US legal regulations. This time it concerns the Opyn, ZeroEx and Deridex protocols, which, according to the CFTC, have not registered various offers for trading in derivatives related to the cryptocurrency sector.

It is worth adding here that Deridex and Opyn were accused of not registering as futures brokers. However, this is not the end, because American officials accused both companies of being, in fact, entities that perform illegal swap transactions. Moreover, in the CFTC's opinion, both protocols violated the Consumer Protection Act.

All three DeFi projects mentioned above are additionally accused of providing leverage services and trading commodity contracts using digital assets without obtaining an appropriate license from the US authorities.

As part of the latest regulatory actions, Opyn, ZeroEx, and Deridex were ordered to pay fines of $250,000, $200,000, and $100,000, respectively. All of the companies identified above were consequently forced to cease violating the Commodity Exchange Act and CFTC regulations.

CFTC's position on the DeFi sector

Ian McGinley, who is an employee of the CFTC, recently noted that although the DeFi space is extremely innovative and complex, regulators will continue to pursue unregistered and uncontrolled platforms that allow residents of the United States to trade derivatives based on digital currencies.

Finally, it is worth adding that Opyn is a platform for investment strategies in the DeFi sector, which currently boasts a total volume of closed positions of $23 million. In turn, ZeroEx is a decentralized exchange based on the Ethereum infrastructure, while Deridex is a derivatives platform based on Algorand, which was liquidated in February 2023.