The U.S. Security and Exchange Commission (SEC) has ruled that startup Enigma MPC violated federal securities laws when it conducted the ENG token ICO. The company must refund investors and pay a fine.
SEC DECLARES ENG TOKENS AS SECURITIES
The ICO took place in November, 2017 and raised approximately $45 million dollars. ENG is an Ethereum token that, like many, quickly saw its value skyrocket only to decline quickly within weeks. In the SEC press release the agency states that the company must establish a process by which customers can receive compensation.
John T. Dugan, Associate Director for Enforcement in the SEC’s Boston Regional Office states:
All investors are entitled to receive certain information from issuers in connection with a securities offering, whether it involves more traditional assets or novel ones . . . The remedies in today’s order provide ICO investors with an opportunity to obtain compensation and provide investors with the information to which they are entitled as they make investment decisions.
The company is cooperating and will pay a fine of $500,000. None of Enigma MPC’s executives appear to be facing criminal charges. Also, unlike others, the ENG token ICO does not appear to have been a deliberate scam. Read More...