SEC Suspends Trading In 3 Companies Due To ‘Questions’ Around Cryptocurrency Ties
The trading in three companies’ stocks has been suspended by the SEC due to questions surrounding their acquisition of crypto assets
The Securities and Exchange Commission (SEC) published a report Thursday, Feb. 15 explaining the temporary suspension of trading in three companies that had made statements about acquiring cryptocurrency and “Blockchain technology-related assets”.
All three companies, Cherubim Interests (CHIT), PDX Partners (PDXP), and Victura Construction Group (VICT) have been suspended starting Feb. 16 for two weeks for investor protection purposes. The SEC trading suspension orders state that all three companies issued press releases that claim that:
“[T]he companies acquired AAA-rated assets from a subsidiary of a private equity investor in cryptocurrency and blockchain technology, among other things. According to the SEC order regarding CHIT, it also announced the execution of a financing commitment to launch an initial coin offering [ICO],”
The SEC orders also state “there are questions regarding the nature of the companies’ business operations and the value of their assets”.
In late August, 2017, the SEC issued a warning to investors regarding ICOs and the potential for scams, including reasons it might suspend trading of a company “to protect investors and the public interest”. On Jan. 22, 2018 SEC Chairman Jay Clayton warned that companies that shift their business models “on the promise” of Blockchain technology will face closer scrutiny from regulators.