The SEC is seeking a default judgment against three companies and four individuals for their roles in an allegedly fraudulent ICO that duped $9 million from 500 investors.
An initial coin offering, or ICO, is a controversial fundraising method for launching blockchain and cryptocurrency networks that involves the sale and distribution of a new crypto asset in exchange for other tokens, commonly Bitcoin (BTC) and Ether (ETH).
During the “ICO mania” of 2017 to 2018, projects collectively raised billions of dollars in capital, largely through nonaccredited investors.
This funding method has since lost most of its legitimacy, both inside and outside the industry. Many ICOs were clearly frauds or, at best, operating in regulatory gray areas. Over the past few years, regulatory agencies such as the United States Securities and Exchange Commission,or SEC, have brought legal action to past and present ICOs, slowly creating legal precedent and guidelines for future ventures.
While the ICO is now a precarious fundraising method for projects and investors alike, it did showcase a powerful use case of blockchain in permissionless fundraising at incredible scale. Over time, the launch methods of cryptocurrency networks will become more sophisticated, safe and, perhaps, regulatorily sound.
The settlement with the SEC came after the three were charged in September for their participation in “unregistered and fraudulent” ICOs.7646
The SEC summarized its efforts on combating crypto misconduct as its chairman is set to step down by the end of this year.4619
Numerous on-chain indicators suggest Ethereum price is on the verge of another 2017-style bull run.29846
A new virtual assistant powered by blockchain can complete insurance contracts without human assistance.9257
In a record-breaking year, the SEC seized $4.68 billion — more than a quarter of which came from cryptocurrency-related firms.4238
Bitcoin’s experimental launch contributed to its dispersion among the masses.6664
Blockchain technology is just a tool that solves a problem, it cannot be the goal of the entire project.38443
Telegram must pay $625,000 to Lantah LLC — a small crypto firm it sued in 2018 over using the ‘GRAM’ trademark and ticker.8543
The U.S. government is seeking harsh sentencing for the founder of the company behind a fraudulent, celebrity-promoted initial coin offering from 2017.6239
Hinman's commentary on the status of cryptocurrencies and the Howey Test was particularly critical to regulation surrounding ICOs.7928
The outlook is grim for the Canadian messaging app as it loses $5 million over its initial coin offering for Kin tokens.5403
Participants of a $5.6 million token sale did not expect a return on investment, the NAC Foundation argued.5385
The Department of Justice made headlines in crypto and elsewhere, leading a week of law enforcement locking down around the world.16013
Nobody who believes in crypto wants it to be a sector beholden to criminality or poor commitment to security.27175