SEC settles with blockchain company for $24 million over unregistered ICO

Securities Digital Assets SEC Initial Coin Offerings Virtual Currency

On September 30, the SEC announced a settlement with a blockchain technology company resolving allegations that the company conducted an unregistered initial coin offering (ICO). According to the order, the company raised several billion dollars from the general public after an ICO, in which it publicly offered and sold 900 million digital assets in exchange for virtual currency, to raise capital to develop software. The SEC alleges that the company violated Section 5(a) and 5(c) of the Securities Act because the digital assets it sold were securities under federal securities laws, and the company did not have the required registration statement filed or in effect, nor did it qualify for an exemption to the registration requirements. The order, which the company consented to without admitting nor denying the findings, imposes a $24 million civil money penalty.