Crypto Case Tests SEC’s Ability to Police Blockchain Technology

May 17, 2024, 9:00 AM UTC

A New York judge likely will soon have to tackle some of the thorniest questions for regulators trying to police the cryptocurrency market.

Richard Heart, who founded and marketed the crypto token Hex, is accused by the Securities and Exchange Commission of selling unregistered securities and illegally using investor funds to buy luxury goods, including a $1.38 million Rolex watch and a 555-carat black diamond known as “The Enigma.” Heart is asking a federal judge to dismiss the SEC’s case.

The case is a test of law enforcement’s reach in policing borderless crypto transactions. It also underscores questions about liability ...

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