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US SEC issues a cease and desist order against ShipChain over its unregistered ICO.

The U.S. Securities and Exchange Commission (SEC) has flagged 28 companies it alleged have been soliciting investors without
The U.S. Securities and Exchange Commission (SEC) has flagged 28 companies it alleged have been soliciting investors without obtaining the proper registration.

The United States Securities and Exchange Commission (SEC) has issued a cease and desist order against ShipChain for allegedly distributing unregistered securities. The blockchain company raised $27.6 million in an initial coin offering (ICO) in 2017 and 2018. ShipChain promised to develop an Ethereum-based blockchain system to track the shipping containers. The US SEC is now alleging that the tokens fall under the category of securities, but the blockchain company did not register them as one.

ShipChain sold more than 145 million SHIP tokens.

ShipChain approached the investors by promising to utilize the ICO proceeds to develop the blockchain system that will “jumpstart the ShipChain economy and supplement funding to help [ShipChain] deliver the best product possible.” The SEC noted in its order that a purchaser in the offering of SHIP tokens would have had a reasonable expectation of obtaining a future profit based on ShipChain’s representations and efforts to build its business, including through its use of the ICO fund proceeds to develop its platform.

US SEC wants SHIP tokens to delist from crypto exchanges.

The financial regulator SEC wants ShipChain to transfer all its native tokens called SHIPS and delist them from crypto exchanges. Additionally, it is seeking a civil penalty of two million dollars. The US SEC order’s impact is reflected in the crypto market as the SHIP token prices plummeted over 62 percent in the last 24 hours. Currently, SHIP tokens are changing hands at $0.001179, while at the peak in April 2018, each token was priced at $0.19. Furthermore, the blockchain company received a similar cease and desist order in May 2018 from the securities regulator in South Carolina, where the company is based, for violating state securities laws.

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