Cumberland DRW LLC

Cumberland DRW LLC, formerly Cumberland Mining & Materials, is the cryptocurrency trading division of DRW Holdings, a privately held trading firm. It is one of the best-known market-making firms in the bitcoin trading world.
Cumberland DRW announced in June 2024 that the New York State Department of Financial Services had granted its New York-based entity a virtual currency license called BitLicense, one of the more difficult licenses for crypto companies to obtain.
== Background ==
In 2014 DRW set up Cumberland, whose name refers to the Grateful Dead's "Cumberland Blues," about a miner. Cumberland originally focused on cryptocurrency mining. It has mined Zcash, which is reputed to have better privacy features than bitcoin. DRW as Cumberland experimented with trading cryptocurrencies in 2015. 
Cumberland reportedly bid successfully on 27,000 bitcoin of one of the final lots of bitcoin seized from Silk Road and auctioned off by the U.S. Marshals Service in 2015. In total, Cumberland is thought to have acquired 70,000 bitcoins in such auctions around the world.
Bobby Cho joined Cumberland as its global head of trading cryptocurrency in 2016 from itBit, a New York exchange and technology firm. Jim Radecki joined Cumberland as global head of business development in October of 2017 after a year of consulting after leaving Goldman Sachs. After RGM Advisers was acquired by DRW in 2017, Richard Gorelick, RGM's CEO, joined Cumberland as head of market structure. 
In March 2019, the firm said in a statement that Jim Radecki would be leaving Cumberland after about 18 months with the company. Two months later, Bobby Cho announced that he was also stepping away from the company. He called the departure "bittersweet," and said that although he was not leaving DRW to join another firm, "there's never a right time to step away from something you've guided for the past 3+ years."
=== SEC Charges Against Cumberland DRW ===
On October 10, 2024, the U.S. Securities and Exchange Commission (SEC) filed charges against Cumberland DRW LLC for operating as an unregistered dealer in the crypto asset markets. The SEC alleged that Cumberland had engaged in buying and selling over $2 billion worth of crypto assets that were offered and sold as securities, without proper registration under federal securities laws.
According to the SEC's complaint, Cumberland had been operating as an unregistered dealer since at least March 2018. The firm publicly marketed itself as "one of the world's leading liquidity providers" in crypto assets, operating 24/7 through telephone trading and its online platform, Marea. The SEC further alleged that Cumberland engaged in trading crypto assets offered as investment contracts on third-party exchanges as part of its regular business activities.
The SEC's complaint, filed in the U.S. District Court for the Northern District of Illinois, charged Cumberland with violating Section 15(a) of the Securities Exchange Act of 1934. The regulatory body is seeking permanent injunctive relief, disgorgement of ill-gotten gains, prejudgment interest, and civil penalties.
=== Crypto Ratings Council ===
In 2019, Cumberland joined several major companies in the cryptocurrency space - including Coinbase, Kraken, Circle, Bittrex, Genesis Global Trading, and Grayscale Investments in forming the Crypto Ratings Council, an organization that rates digital assets on a scale of 1 to 5. The assets are evaluated based on whether they can be considered securities that are not issuable by unregulated cryptocurrency firms; for example, bitcoin scores a 1 on the scale, while XRP is rated as a 4.
== Products and Services ==
Beginning in May 2018, Cumberland was the first dealer to offer its customers 24/7 trading. It currently trades bitcoin against U.S. dollars as well as 500 other fiat currency-cryptocurrency and cryptocurrency-cryptocurrency pairs. It offers services such as over-the-counter trading, derivatives and bilateral options products.
Cumberland is also a market maker for several Bitcoin exchange-traded funds products. 
=== Marea ===
In February of 2019, Cumberland unveiled a single-dealer platform called Marea that allows institutional investors to interact with Cumberland through a screen-based interface, rather than negotiating trades by phone or Skype.
== Key People ==
*Donald R. Wilson - founder & CEO 
*Bobby Cho - former COO
== References ==
Category: fintech
Category: digital assets
Category: decentralized applications
Category: distributed ledgers
Category: cryptocurrency
Category: altcoins
Category:Regulation
Category:Securities and Exchange Commission
Category:Legal/Regulatory
Category:Enforcement Actions