SEC pays more attention to the technology of the blockchain, and cryptocurrency ICO. Last week was marked by two further steps of the Commission in this area.
The California company Munchee Inc returned to investors funds invested in the initial placement of tokens (ICO) after an investigation conducted by the Commission on securities and stock exchanges of the USA. The refund followed the decision of the Commission that placed the tokens can be considered unregistered securities.
This incident is one of the last serious attempts of the SEC to regulate the initial placement of tokens. A week ago, the Commission sued the organizer of placing tokens PlexCoin (which is already faced
accusations of the Supreme court of Quebec). As in the case of PlexCoin, the decision token Munchee is the work of a new division the SEC to combat fraud in the ICO created
in September of this year.
Munchee, according to the thread on Bitcointalk, was advertised as «Yelp combined with Instagram» — a new app for posting restaurant reviews. It was assumed that the token MUN will serve to stimulate activity in the social network of the company.
However, in order to terminate unlawful actions of the SEC dated December 11, the Commission notes that the MUN tokens are considered as securities because they are «investment contracts». The document further stated that the data tokens are in any case considered to be securities, regardless of their «purpose» in the sales process.
«Even if the tokens MUN had a practical application at the time of posting, this does not prevent them to be securities», — stated in the SEC order.
It is unclear how much money was collected, but the SEC stated that «about 40 investors» bought tokens. The Commission also noted that it contacted Munchee on the second day of the sale and that the company has «not given tokens to customers.»
In a statement, the Agency has noted the rapid cooperation Munchee after the start of the investigation.
«The Commission decided not to impose a fine, as the company quickly ceased ICO, immediately returned the funds to issue tokens and assisted in the investigation,» said Stephanie Avakian (Avakian Stephanie), the head of one of divisions of the SEC.
The statement of the representative of the SEC
Head of investment Management of the securities and exchange Commission Blass Dalia (Dalia Blass) said that the Agency deals with the newly registered funds which plan to use cryptocurrencies.
Last Thursday she told us that the Agency responsible for monitoring investment activities in the United States, faces challenges arising in connection with work of firms investing in fully digitized assets.
«We continue to think about innovations in managing assets. For example, we have received several applications for the registration of funds investing in cryptocurrencies. As with any new product, there are some questions that need to be addressed,» said
Blass during a speech at the Conference on development of securities legislation in Washington.
These issues include questions about the distinction between asset types and what information in relation to risks should be provided to investors.