According to a new study, there has been a 42% increase in lawsuits related to cryptocurrencies in 2022. Last year saw the highest number of claims recorded in one year, with 41 claims made in the United States.
Research further indicated that the majority of the cases were initiated by the Securities and Exchange Commission (SEC) in the US.
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Just like there is a fluctuation in the prices of different cryptocurrencies, the number of crypto-related filed in the United States every year also see the same fluctuations.
A new study was recently published by hedgewithcrypto.com, which showed that crypto lawsuits experienced an increase of more than 40% between 2018 and 2022.
However, there have been some declines in between the highs as well. The highest number of lawsuits that were filed in one year was 41 and this occurred in the previous year.
The researchers said that the number of lawsuits had declined by 30% in 2019, as they fell to 21 from 30. 2020 recorded a significant rise of a little less than 62%, as the number of cases rose to 34.
2021 saw another decline in cases, as they fell to 28. But, 2022 once more saw crypto-related lawsuits rise by more than 46%, as there were 13 more cases last year than the year before.
In 2022, around 19 lawsuits were associated with the Securities and Exchange Commission (SEC), as the top securities regulator in the country has been going after unregistered securities and services.
Over the years, the most common lawsuits in the crypto industry have been those related to unregistered securities and services, as a total of 53 of them have been filed since 2018.
There were 12 lawsuits that were related to initial coin offerings (ICOs), while 10 lawsuits were related to fraud or theft.
Eight lawsuits were also related to the unlawful promotion of cryptocurrencies and non-disclosure cases, while five of the cases had to do with making misleading and false statements regarding a crypto product.
The research showed that one of the most renowned lawsuit type is related to the promotion of crypto products without disclosure of payments, as this typically involves celebrities.
For instance, there were more than 50,000 articles that were generated about the promotion case of Emax, which involved the SEC and Kim Kardashian. These were found in Google’s search engine.
The smallest number of lawsuits that were recorded in the last five years were related to pyramid scheme fraud and falsification of company revenue.
The data that was compiled by the hedgewithcrypto.com researchers was obtained from the lawsuits that were recorded by the SEC as well as Stanford law.
It is not surprising that 2022 saw a rise in the number of lawsuits filed, given that it turned out to be a chaotic year for the market.
There were numerous bankruptcies and collapses in 2022 and the overall market experienced a massive downturn, which resulted in regulatory attention and action.