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EOS maker Block.One agrees to settle $24M penalty with SEC over unregistered ICO

Image Credit: Block.One

Tue, 01 Oct 2019, 06:51 am UTC

The Securities and Exchange Commission (SEC) has agreed to settle charges against EOS maker Block.One for carrying out an unregistered securities sale.

As per a press release, the blockchain builder has reportedly agreed to pay $24 million in penalties after raising a total of $4.1 billion in an unregistered initial coin offering between 2017 and 2018.

The announcement further noted that Block.One’s token sale was done shortly before the SEC released its DAO report and “continued for nearly a year after the report’s publication.”

Stephanie Avakian, SEC’s Division of Enforcement co-director, also stressed that the firm failed to register its ICO as a securities offering, while “a number of US investors participated in Block.One’s ICO.” This means the regulator found that the firm violated the securities laws and ordered the penalty.

Block.one did not provide ICO investors the information they were entitled to as participants in a securities offering,” Steven Peikin, Division of Enforcement’s co-director, said.

Meanwhile, Block.One also issued its own press release, pointing out that the settlement is only applicable to the sale of the original ERC-20 token it sold. It also made clear that its ERC-20 token is no longer in circulation and “will not require the token to be registered as a security with the SEC.”

The SEC has simultaneously granted Block.one an important waiver so that Block.one will not be subject to certain ongoing restrictions that would usually apply with settlements of this type,” the company stated, adding that SEC’s granting of the waiver shows that Block.One is committed to complying with the U.S. and global regulations.

The settlement follows after Block.One plans to open another site in Washington, D.C. metropolitan region. The new office will reportedly serve as the new headquarters for its U.S. operations arm in Arlington, Virginia.

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