CryptoFed's U.S. Registration Under Threat as SEC Alleges Filing Anomalies
The SEC has initiated administrative proceedings against American CryptoFed to determine the issuance of a halt order that would deregister and prohibit the internal token sales, Ducat and Locke.
New
Disclaimer: The article has been updated based on an official response from American CryptoFed DAO. COO Xiaomeng Zhou explained why the SEC is not legally authorized to issue a shutdown order.
American CryptoFed DAO, the first Decentralized Autonomous Organization (DAO) to gain legal recognition in the United States, faces losing its registration after the United States Securities and Exchange Commission (SEC) discovered anomalies in the Form S-1 registration statement dated September 17, 2021.
The Wyoming Secretary of State's Office recognized American CryptoFed as a legal entity in July 2021, at a time when the organization's CEO, Marian Orr, believed that "Wyoming is arguably the first blockchain jurisdiction in the world".
However, on November 18, 2022, the SEC commenced administrative proceedings against the DAO to determine whether to issue a shutdown order. A halt order from the SEC would deregister American CryptoFed and prevent internal, Ducat and Locke token sales.
According to the SEC Division of Enforcement, the Form S-1 registration statement filed by American CryptoFed lacks vital information, such as audited financial statements and details about its operations and management. The SEC further found that CryptoFed's US filing contained "misleading statements and omissions" while being inconsistent in describing the tokens as securities.
In this regard, David Hirsch, Head of the Cryptographic and Cyber Assets Unit of the Law Enforcement Division, stated that:
"American CryptoFed has not only failed to comply with the disclosure requirements of federal securities laws, but it has also asserted that the securities transactions they seek to record are in fact not transactions. on titles...
The SEC has initiated administrative proceedings against American CryptoFed to determine the issuance of a halt order that would deregister and prohibit the internal token sales, Ducat and Locke.
New
Disclaimer: The article has been updated based on an official response from American CryptoFed DAO. COO Xiaomeng Zhou explained why the SEC is not legally authorized to issue a shutdown order.
American CryptoFed DAO, the first Decentralized Autonomous Organization (DAO) to gain legal recognition in the United States, faces losing its registration after the United States Securities and Exchange Commission (SEC) discovered anomalies in the Form S-1 registration statement dated September 17, 2021.
The Wyoming Secretary of State's Office recognized American CryptoFed as a legal entity in July 2021, at a time when the organization's CEO, Marian Orr, believed that "Wyoming is arguably the first blockchain jurisdiction in the world".
However, on November 18, 2022, the SEC commenced administrative proceedings against the DAO to determine whether to issue a shutdown order. A halt order from the SEC would deregister American CryptoFed and prevent internal, Ducat and Locke token sales.
According to the SEC Division of Enforcement, the Form S-1 registration statement filed by American CryptoFed lacks vital information, such as audited financial statements and details about its operations and management. The SEC further found that CryptoFed's US filing contained "misleading statements and omissions" while being inconsistent in describing the tokens as securities.
In this regard, David Hirsch, Head of the Cryptographic and Cyber Assets Unit of the Law Enforcement Division, stated that:
"American CryptoFed has not only failed to comply with the disclosure requirements of federal securities laws, but it has also asserted that the securities transactions they seek to record are in fact not transactions. on titles...
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