It's only February, but the world of financial technology is already off to a roaring start this year. The red-hot cryptocurrency market has grabbed headlines, and fintech companies are accelerating the rate of change in how banking and personal finance get done.

This surge of activity is prompting plenty of action at the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission and the Conference of State Bank Supervisors.

Here are a few of the latest fintech legal and regulatory developments:

SEC:

As promised in the virtual currency hearings that took place earlier this month before the U.S. Senate Committee on Banking, Housing and Urban Affairs, the chairs of the SEC and the CFTC are following through with more enforcement actions against alleged bad actors in the space.

The SEC Wednesday announced charges against a bitcoin-denominated platform, BitFunder, and its founder Jon Montroll. According to the SEC's complaint, BitFunder was operating as an unregistered securities exchange and “defrauded exchange users by misappropriating their funds and failing to disclose a cyberattack on BitFunder's system that resulted in the theft of more than 6,000 bitcoins.”

“Platforms that engage in the activity of a national securities exchange, regardless of whether that activity involves digital assets, tokens or coins, must register with the SEC or operate pursuant to an exemption,” said Marc Berger, director of the SEC's New York regional office, in a press release Wednesday. “We will continue to focus on these types of platforms to protect investors and ensure compliance with the securities laws.”

Earlier this month, the SEC announced the suspension of trading for three companies “amid questions surrounding similar statements they made about the acquisition of cryptocurrency and blockchain technology-related assets.”

The three issuers were questioned by the SEC about their business operations and the value of their assets, according to the Feb. 16 press release announcing the action. One of the companies was allegedly delinquent in filing reports with the commission.

“This is a reminder that investors should give heightened scrutiny to penny stock companies that have switched their focus to the latest business trend, such as cryptocurrency, blockchain technology or initial coin offerings,” said Michele Wein Layne, director of the Los Angeles regional office, in the announcement.  

CFTC:

The CFTC revealed this week that it has established a cooperation arrangement with the Financial Conduct Authority in the U.K. this week, but that's not all the agency has been up to.  Last week, the CFTC released a customer protection warning about pump-and-dump virtual currency schemes.

For the uninitiated, the CFTC outlines in its advisory what investors need to watch out for: “Pump-and-dump schemes are mostly anonymous and are organized in public chat rooms or via mobile messaging apps. They are coordinated efforts to create phony demand (the pump) and then sell quickly (the dump) to profit by taking advantage of traders who are unaware of the scheme.”

The advisory goes on to say that this type of manipulation is plaguing the virtual currency space and typically occurs on platforms that offer a variety of coin pairings.

CSBS:

One of the biggest issues that has emerged since the introduction of the Office of the Comptroller of the Currency's proposed national special purpose charter for fintechs last year is growing tension between federal and state banking regulators. Although the so-called fintech charter has not been finalized, fintech firms have adamantly voiced frustration about the lack of uniform regulations from state to state.

In response, the CSBS has filed suit against the OCC and claimed it lacks authority to create the fintech charter. But outside that legal fight, state banking regulators have received the message that uniformity in regulations would be helpful for fintechs. 

John Ryan, president and CEO at the CSBS, wrote in a Feb. 15 blog post that “as nonbanks modernize the financial services industry, we as regulators are modernizing the state regulation of nonbanks. … States have been exploring how fintechs and other nonbanks can become licensed more quickly and scale regionally or nationally more easily, while regulators provide increased focus on core issues of risk. We are mindful that our approvals, when we give them, must set a high standard that creates confidence in consumers who wish to use fintechs and other new firms.”

Ryan's commentary was published shortly after seven states announced they would introduce standardization in the licensing process for money services businesses.

How will it work? “If one state reviews key elements of state licensing for a money transmitter—IT, cybersecurity, business plan, background check and compliance with the federal Bank Secrecy Act—then other participating states agree to accept the findings,” the CSBS wrote in a Feb. 6 announcement.

In a Feb. 21 report, Idaho's banking regulators indicated that the state intends to join the banking compact, which so far includes Georgia, Illinois, Kansas, Massachusetts, Tennessee, Texas and Washington.