1Pool to Pay $990,000 for Illegal BTC Transactions

Wilfred Michael 

Wilfred Michael

News reporter

12 March 2019,
10:41
1Pool to Pay $990,000 for Illegal BTC Transactions

According to a Monday, March 11, press release, a court order has resolved an action between the U.S Commodity and Futures Trading Commission (CFTC) and 1Pool Ltd, a Marshall Island-based securities dealer.

The regulators alleged that 1Pool Ltd and its founder Patrick Brunner sold Bitcoin-margined retail commodities to U.S residents without registering as a Futures Commission Merchant with the CFTC. Also, the CFTC claimed that 1Pool did not have the right anti-money laundering requirements in place for the Bitcoin-related commodities. It imposed the following sanctions on 1Pool Limited and its founder:

  • A civil monetary penalty of $175,000

  • Disgorgement of 1Pool’s gain from the transaction up to $246,000

  • A payback of all Bitcoin holdings belonging to U.S customers with certification that the repayment was completed. The total returns would be 93 BTC, valued by CFTC to worth roughly $570,000

  • The total refunds expected from 1Pool to strike out the lawsuit is $990,000.

As a follow up to the orders against, 1Pool Ltd, CFTC Director of Enforcement, James McDonald reiterated that securities intermediaries should ensure regulatory compliance by duly completing registration and procedures designed to protect investors in the U.S market.

He adds that “through the Division’s Bank Secrecy Task Force, Enforcement will continue to investigate and prosecute such violations.”

As Stmarket.co has reported in the past, the CFTC’s decisions regarding cryptocurrency-related transaction stem from an understanding of the industry, unlike the U.S SEC who industry experts condemn for being rigid with innovation.

In recent times, the CFTC has published a guide about smart contracts and also asked for public insights to learn more about the operations of the Ethereum blockchain. It is likely that any new laws introduced at this point will also be based on knowledge rather than assumptions about how the industry operates.

 

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