State Attorneys General Poised to Elevate Regulatory Scrutiny of Digital Asset Businesses

The Attorney General Alliance recently issued a collaborative White Paper that signals heightened scrutiny of digital asset businesses by state attorneys general in coming years. Recognizing that it is “no longer acceptable to be on the sidelines” because blockchain technology and virtual assets are “here to stay,” the AGA issued its White Paper to inform state attorneys general about various cryptocurrency and blockchain issues. To this end, the White Paper provides an overview of the digital asset marketplace, summarizes the status and scope of state and federal regulation of digital asset businesses, highlights the important role of state attorneys general in investigating digital asset businesses and initiating enforcement actions, and spotlights recent noteworthy settlements.

The AGA signals that, in the absence of a comprehensive federal regulatory scheme, states will continue to enact laws that reach a range of digital asset activity and state attorneys general will expand and ramp up investigations and legal actions that seek injunctions, restitution and civil penalties from digital asset businesses.