Today, the Securities and Exchange Commission (SEC) indicated its purpose to pursue digital coins that are capitalized by engaging in illicit conduct. So, the intention is along with other regulators.
Recently, the SEC interfered versus one such entity. This is a Dallas-based digital coin dealer, the label is Bitqyck Inc. (“Bitqyck”).
On August 29, 2019, the SEC, together with the founders of Bitqyck, declared that it had achieved a settlement for approximately $10.1 million.
So, the SEC’s actions express that institutional investors may be best provided by exercising reasonable due diligence.
It is as an alternative of exclusively relying on the statements made by cryptocurrency issuers when deciding whether to invest.
Hence, the SEC’s complaint alongside Bitqyck filed in the United States District Court for the Northern District of Texas.
Moreover, it has suspected Bitqyck and its founders, Bruce Bise and Sam Mendez, for defrauding investors and running an unregistered exchange.
List of Violations Bitqyck’s Made
SEC charged Bitqyck, Bise, and Mendez with breaches of Sections 5(a), 5(c), and 17(a) of the Securities Act, as well as Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.
Bitqyck received accussement of violating Section 5 of the Exchange Act and Bise and Mendez with aiding and supporting that violation.
The SEC’s criticism portrayed a picture of fraud that infused nearly every portion of Bitqyck’s business model.
The protest against Bitqyck claimed that it has mass-marketed two digital tokens. These are Bitqy and BitqyM, owned and operated by Bise and Mendez.
The digital coins were for futures investors in 45 US states. They split into two US territories and 20 countries via multiple unregistered digital asset securities offerings.
Meanwhile, the company lifted more than $13 million over 13,000 investors. These are the ones who cooperatively lost over two-thirds of their assets. This information was according to the SEC.
Elsewhere, the suspects started the process by lying to investors. If they purchase a Bitqy token, they would automatically receive one-tenth of one share of Bitqyck.
Bitqy, a standard stock used by the function of a “smart contract” connected with the token.