SEC Charges Blockchain of Things For Operating Unregistered ICO
Tech startup BCOT (Blockchain of Things) has agreed to pay the SEC (Securities and Exchange Commission) $250,000 for its ICO (initial coin offering) that was launched in 2017. The payment will be divided into four parts, with each amounting to $62,500.
The SEC requires the company to pay the initial payment in the next 30 days, after which Blockchain of Things will consequently submit the next three in the next 60, 90, and 120 days. Faltering to obey this payment schedule will result in penalty interest.
The SEC has declared that all ICOs are categorized as securities and are directed to registration to the regulatory body. Considering Blockchain of Things didn’t register its 2017 ICO, the SEC filed a cease-and-desist order against the tech startup.
BCOT agreed with four resellers situated in Vietnam, South Korea, Japan, and the United Arab Emirates. Although these resellers were deemed to distribute the tokens only within their respective borders, BCOT didn’t impose strict monitoring where the tokens are being traded.
“BCOT had no visibility into the Foreign Resellers’ token sales practices, such as what the Foreign Resellers made disclosures and representations to potential purchasers. BCOT also lacked any visibility into the identity of potential purchasers,” the SEC filing read.
The SEC has been crashing down on these illicit ICO ever since the prevalence of Bitcoin chuck the crypto industry into the mainstream scene. The regulatory body charged Shopin’ founder Eran Eyal with deceiving investors after it launched an ICO that raised $42 million.
The money was supposed to finance the development of a blockchain-based shopper profile that can record a purchaser’s behavior and logged it on a digital ledger. Instead, Eyal misused $500,000 of the raised fund to maintain his lavish lifestyle.
Meantime, the SEC is also investigating to get to the root of the Telegram case that’s been fermenting for a while. The agency has already taken the testimony of two Telegram employees and is slated to obtain the statements of the company’s CEO on Jan. 7 or 8.
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