US securities regulator halts Wyoming crypto firm’s tokens

Platform Economy: SEC

The US securities regulator has halted registration for two digital tokens offered by Wyoming-based American Cryptofed DAO LLC, accusing the company of providing misleading information to investors in regulatory filings.

The US Securities and Exchange Commission (SEC) said in a statement that American Cryptofed “filed a materially deficient and misleading” form when it sought to register the tokens, known as “Ducat” and “Locke,” as equity securities. The disclosures did not contain required information about both the tokens and the company, and contained materially misleading statements, the SEC said.

The SEC alleged the company’s form left out the required information about the company’s business, management and financial condition, among other omissions, and also gave inconsistent statements about whether the tokens are securities.

American Cryptofed CEO Marian Orr disputed the SEC’s view that the tokens are securities and said the company had been trying to discuss the issue with the SEC when the agency refused to respond to the firm’s October rebuttal.

“The purported ‘deficiencies’ the SEC referred to were the lack of attributes inherent to securities,” she said in a statement.

“These are attributes that the two tokens (Locke and Ducat) of a decentralized blockchain-based CryptoFed DAO monetary system will never have.”

The back-and-forth highlights the increasingly tense relationship between the cryptocurrency industry and the top US markets regulator, which has taken a more aggressive position under Democratic leadership.

Related article:
Peru's central bank joins global push to develop a digital currency

SEC Chair Gary Gensler appears to have taken a more expansive view of whether crypto assets fall under the SEC’s purvey. He has said the agency is examining cryptocurrencies in a number of areas and has described the crypto world as a “Wild West” riddled with fraud and investor risk.

The team at Platform Executive hope you have enjoyed the ‘US securities regulator halts Wyoming crypto firm’s tokens‘ article. Automatic translation from English to a growing list of languages via Google AI Cloud Translation. Initial reporting via our official content partners at Thomson Reuters. Reporting by Chris Prentice. Additional reporting by Susan Heavey. Editing by Chris Gallagher and Richard Pullin

You can stay on top of all the latest developments across the platform economy, find solutions to your key challenges and gain access to our problem-solving toolkit and proprietary databases by becoming a member of our growing community. For a limited time, our subscription plans start from just $16 per month.

Share this Article