SEC Reaches $24M Settlement With EOS’ Parent Firm Block.One

The United States Securities and Exchange Commission (SEC) is in the cryptocurrency news today for reaching a settlement with the parent firm of EOS, Block.one, in which it will pay $24 million in penalties for carrying out an unregistered initial coin offering. Now that SEC reaches a settlement with Block.one, things are expected to go more smoothly.

On September 30, the SEC went with a press release, noting that it has settled the charges against the firm which is behind the EOS network and its corresponding token – in the form of a civil monetary penalty. Block.one also settled the charges without admitting or denying them.

As the press release shared in the crypto news outlining that SEC reaches a settlement with the EOS parent firm shows, Block.one’s ICO of 900 million tokens “began shortly before the SEC released the DAO Report of Investigation and continued for nearly a year after the report’s publication.”

What we can also see is that Block.one raised the sum to billions of dollars but failed to register an initial coin offering (ICO) as a securities offering in agreement with the US federal securities laws. The press release by SEC notes that neither it did that “nor did it qualify for or seek an exemption from the registration requirements.”

“A number of U.S. investors participated in Block.one’s ICO. Companies that offer or sell securities to U.S. investors must comply with the securities laws, irrespective of the industry they operate in or the labels they place on the investment products they offer,” the co-director of the SEC’s Division of Enforcement Stephanie Avakian noted.

The news that SEC reaches an agreement with Block.one were nicely accepted in the crypto community too.

“The SEC remains committed to bringing enforcement cases when investors are deprived of material information they need to make informed investment decisions,” Avakian said.

The $24 million fine is something that probably won’t make a significant dent, mostly because it only represents a small portion of the $4 billion initial raise. As we recently reported on the news, Block.one opened its fourth global site located in the Washington, DC area – something that will create 170 high skilled jobs over a period of three years.