Cryptocurrency has gained quite some name in a matter of a few years, and with this name came many scams that caused monetary harm to many people. In the recent news, a Texas-based cryptocurrency firm, Bitqyck and it’s founders were accused of wrongfully issuing digital currency to people.
The US Securities and Exchange Commission fined Bitqyck founders, Bruce Bise and Sam Menendez for using an unregistered online trading platform and for wrongfully issuing digital offerings to people.
The founders gained about $13 million by creating and selling the unregistered security offerings to more than 13,000 people who invested in the project. SEC alleged that the defendants informed their investors that Bitqy would provide them with a fraction of share in the firm’s stock through smart contracts whereas the other token, BitqyM would act as the part of a crypto mining facility.
In reality, the firm had no such facility under their ownership, and it also allowed the customers to trade the Bitqy coins using an unregistered exchange, TradeBQ. The founders neither accepted nor denied the SEC’s claims.
David Peavler, head of SEC’s regional office in Fort Worth, believes that they took advantage of the investor’s interest in having a part in the base level of a business. In the end, all parties agreed to the deal of returning the ill-gotten gains with interest, and this leads to about $10 million.
Bitqyck has agreed to pay $8,375,617, and Bise and Menendez will pay $890,254 and $850,022 respectively.