Türkçe
Español
The SEC has long created a nightmare for the crypto markets, but with Trump’s arrival, this nightmare may end. This change has contributed to the recent rise in the markets. However, the newly announced SEC sanctions have resulted in a paradox where some crypto investors are reportedly pleased with the SEC actions.
SEC and Cryptocurrencies
Institutions like the SEC must actively work to penalize fraudsters in the cryptocurrency space. Instead of pursuing unnecessary legal actions, public institutions should monitor fraudulent activities in the crypto sector. Today, we witnessed a good example of this. The SEC announced that the NFT initiative Theory will pay a penalty of $6,103,914, which is significant because it will be paid to the defrauded investors.
On August 28, 2023, the Commission issued an order against Impact Theory, LLC under Section 8A of the Securities Act of 1933.
According to the decision, between October 13, 2021, and December 6, 2021, Impact Theory, a media and entertainment company, offered and sold crypto asset securities known as KeyNFTs in the form of purported NFTs, raising approximately $29.9 million worth of Ether from hundreds of investors, including those in the United States.
At the time, this case did not draw much attention as there were victims, and the SEC needed to resolve the issue, unlike the situation with FTX. The recently released announcement provides significant details regarding this case.
The Commission determined that Impact Theory violated Sections 5(a) and 5(c) of the Securities Act by offering and selling these securities without submitting a registration statement to the Commission or qualifying for any exemption. As a result, the defendant was ordered to pay $6,103,914.17, which includes $5,120,718.27 in compensation, $483,195.90 in prejudgment interest, and a $500,000.00 monetary penalty. The Commission also established a Fair Fund under Section 308(a) of the Sarbanes-Oxley Act of 2002 to ensure that the collected penalties, disgorgement, and prejudgment interest will be distributed to harmed investors.
