SEC charges crypto exchange execs for the first time over unregistered token sales
An employee wearing a protective face mask inspects Sapphire Technology Ltd. AMD graphics processing units (GPU) at the Evobits crypto farm in Cluj-Napoca, Romania, on Wednesday, Jan. 22, 2021. The world's second-most-valuable cryptocurrency, Ethereum, rallied 75 percent this year, outpacing its larger rival Bitcoin. | Photo by Akos Stiller / Bloomberg via Getty Images The Securities and Exchange Commission issued its first charges against the decentralized finance industry Friday, accusing two people of illegally selling over $30 million of securities in unregistered offerings.
The SEC's Friday order found that two executives from the Blockchain Credit Partners company used the Ethereum blockchain to sell cryptocurrencies to investors while misleading them about the company's profitability. Specifically, investors purchased cryptocurrencies using digital assets like ether. The company then promised to pay investors over 6 percent in interest and that the funds would go toward physical investments like car loans to create additional income. The SEC determined that these real-world" investments...