The US Commodity Futures Trading Commission (CFTC) has issued a fine against bZeroX, the Blockchain software protocol, and its founders. The penalty negatively impacted the altcoin project of the bZerox founders’ project, the Ooki DAO. Here are the details…
CFTC fines altcoin protocol
The order points to the protocol and its founders, Tom Bean and Kyle Kistner, of illegal, over-the-counter trading of cryptocurrencies, registry violations. It also fines them $250,000 for failing to adopt a customer identity program required by the Bank Secrecy Act compliance program. The CFTC simultaneously filed a civil enforcement action accusing bZeroX’s successor, Ooki DAO, of violating the same laws as bZeroX. It seeks compensation, damages, monetary fines, trade and registration bans, and injunctive relief against further violations.
“These actions are part of the CFTC’s broader efforts to protect US clients in a rapidly evolving decentralized financial environment,” said Gretchen Lowe, Acting Executive Director. bZeroX’s successor, Ooki DAO, was also accused by the CFTC of violating the same laws as bZeroX. After that, Ooki Protocol (OOKI) fell from $0.00522 to $0.00499. At the time of writing, it has lost just over 5 percent.
An official objected to the decision
The CFTC is also seeking action against further violations of CEA and CFTC regulations. “Trading of margined, leveraged or funded cryptoassets available to individual US clients must take place on properly registered and regulated exchanges in compliance with all applicable laws and regulations,” Lowe said. “These requirements apply equally to organizations with more traditional business structures as well as DAOs,” he added. Authorized Summer K. Mersinger made a statement expressing her opposition to the CFTC’s decision and used the following statements:
As federal and state policy evolves, we cannot arbitrarily decide who is responsible for these violations, based on an unsupported legal theory that leads to enforcement through regulation.
More details about OOKI and bZeroX
Ooki is a powerful and fully decentralized margin trading, borrowing and lending platform with tons of features. The Ooki Protocol allows anyone to build applications that enable lenders, borrowers and traders to interact with the most flexible decentralized finance protocol on multiple Blockchains.
Ooki is a fully decentralized, community-run project led by community votes for all major changes to the protocol. The OOKI token is a governance token that allows the Ooki community to manage the protocol by staking the OOKI token and voting in the Ooki DAO. The Ooki ecosystem is designed to emphasize community control over the protocol through governance, fee sharing, and voting.
