The SEC has settled the charges that were raised against Block.one by imposing a fine of $24 million for selling unregistered securities. SEC’s announced on Monday how the company raised billion dollars in an ICO that took place between June 2017 and June 2018.
The company sold around 900 million tokens, and they attracted the headlines when they raised $4.1 billion without even a live product. The ICO was not registered as security offerings, and a major portion of the investors was from the United States.
Stephanie Avakian, the co-director of the division of enforcement, SEC, explained how every company that sells or is planning to sell securities offering to US investors have to comply with the laws. The industry in which they operate does not matter, and neither does the name that they place on the investment products.
A civil penalty was also imposed on the blockchain company as they violated the registration provisions. They didn’t provide the ICO investors the correct information that they were entitled to give them. Block.one responded by saying that the penalty was imposed on the EOS tokens only which were released on Ethereum blockchain. These ERC-20 tokens were later swapped for EOS tokens by the holders.
Block.one was given waiver by the SEC so that their ongoing operations can work well and they believe that this granting by SEC shows how they have worked in compliance of the rules and did best practices in the United States and globally.