The U.S. Securities and Exchange Commission has settled charges against a blockchain company for conducting an unregistered initial coin offering in breach of federal securities laws
What has happened?
The U.S. Securities and Exchange Commission (SEC) has settled charges against New York-based blockchain company Blockchain of Things Inc. for carrying out an unregistered initial coin offering (ICO
What does this mean?
According to the SEC order, Blockchain of Things conducted the ICO after the Commission warned in its 2017 DAO Report of Investigation that ICOs can be securities offerings.
The star-up raised nearly $13 million to develop and implement its business plans, including developing its blockchain-based technology and platform.
The start-up also allegedly said that its platform was intended to allow third-party developers to build applications for message transmission and logging, digital asset generation, and digital asset transfer.
The SEC's order noted that Blockchain of Things sold its digital tokens in certain foreign countries without restrictions on resale of those tokens to U.S. investors.
The order also found the start-up had failed to register its ICO as required under federal securities laws, and that it did not qualify for a registration exemption.
Blockchain of Things has been fined $250,000 and ordered to cease and desist from committing or causing any violations of the registration provisions of the federal securities laws.
It has also undertaken to refund investors who purchased tokens in the ICO and want their money back and will register its tokens as securities under the Securities Exchange Act of 1934 and file period reports with the SEC.
Blockchain of Things consented to the order without admitting or denying the findings.