US agency investigating crypto firms for misconduct
Bitcoin, which surged in 2020 and 2021, is down around 50% so far this year. PHOTO: FILE
A US agency that probes allegations of deceptive conduct confirmed on Monday that it had investigations open into several cryptocurrency firms for "possible misconduct."
The Federal Trade Commission spokesperson declined to name the firms or say precisely what actions prompted the investigations.
"While we can't comment on current events in the crypto markets or the details of any ongoing investigations, we are investigating several firms for possible misconduct concerning digital assets," the spokesperson said in a statement.
Bloomberg said in a report that the investigation was linked to misleading advertising but the FTC spokesperson declined to confirm this.
The spectacular implosion of FTX recently sent fresh shock waves through the cryptocurrency industry, with the value of bitcoin down sharply this year.
The Securities and Exchange Commission, which also has regulations mandating disclosures from individuals promoting securities, has cracked down on celebrity endorsements, including reality TV star Kim Kardashian on allegations of promoting a crypto token on her Instagram account without proper disclosure that she had been paid.
The FTC has also pursued companies that presented themselves as cryptocurrency-related firms but which were allegedly nothing more than scams.