On September 17, 2025, the North American Securities Administrators Association (NASAA), representing U.S. state regulators and their counterparts in Canada and Mexico, sent a letter to the U.S. House Committee on Financial Services’ Subcommittee on Oversight and Investigations, urging Congress not to weaken the powers of state securities regulators. Signed by NASAA President Marni Rock Gibson, the letter highlights states as the “first and often last line of defense” against financial fraud, citing over 330 enforcement actions involving crypto assets since 2017. The plea comes amid proposed federal legislation that could limit state authority, potentially hindering anti-fraud efforts.
NASAA’s appendix details 334 cases, including MLM-related Ponzi schemes like GSPartners (13 actions across 2023–2024), BitConnect (multiple states in 2018), Novatech FX (Alabama 2025, California 2022), AirBit Club (Maryland 2021), Forsage (Montana 2021), Mirror Trading International (Texas 2020), and USI-Tech (Ohio 2018), per. These actions cover crypto offering frauds, trading platforms, advisory services, Ponzi/pyramid, mining scams, and recovery schemes. States’ prosecutorial powers have led to 5,531 months of prison sentences in 2023 alone, per. NASAA warns that curtailing state roles would exacerbate an “epidemic of online fraud” fueled by DLTs and AI, per.
The letter responds to the Digital Asset Market Clarity (CLARITY) Act of 2025, passed by the House on July 18, 2025, and the Senate’s Responsible Financial Innovation Act (RFIA), which could upend state investment contract laws. NASAA proposes the Support Anti-Fraud Enforcement Act (SAFE Act) to protect state authority, per. This aligns with NASAA’s 2025 investor threats list, flagging crypto scams and AI-driven fraud as top risks. X posts from @NASAAorg emphasize states’ role in combating $50.5B in 2024 fraud losses, per.
Weakening state regulators could embolden fraudsters, increasing risks for retail investors, per. Bitcoin (BTC) ($113,234) and Ethereum (ETH) ($4,070) remain stable, per CoinMarketCap, but enhanced state powers could boost trust and adoption. Investors should verify offerings via state regulators at nasaa.org/contact-your-regulator. Diversify into USDC or ETH with stop-losses below BTC’s $112,000, per TradingView. Follow @TheBlock__ on X for updates. NASAA’s advocacy could shape the CLARITY Act‘s final form, potentially passing by September 30, 2025.
