Crypto startup Unikrn, which raised $31M through its ICO back in 2017, must pay a fine to the US Securities and Exchange Commission (SEC) for selling unregistered securities.
According to the SEC, between June and October 2017 Unikrn sold securities in the form of UnikoinGold (UKG) tokens without the required registration.
While Unikrn has neither admitted nor denied the SEC's findings, the startup has agreed to block the UKG tokens and remove them from all the crypto exchanges in which they are available and to pay a fine of up to $6.1M. According to the regulator, this amount is equivalent to almost all of the company's assets. The regulator said in a statement:
"This resolution allows us to return substantially all of Unikrn's assets to already-harmed investors and includes measures to prevent future sales to retail investors, including the disabling of the tokens."
Unikrn attracted 112,720 ethers (about $31M at that time) with the aim of creating an eSports betting platform. In addition, accredited investors bought SAFT agreements worth $16M. The project received the support of billionaire and popular venture capitalist Mark Cuban.
Unikrn received a class action suit in 2018 in which the organizers were accused of selling unregistered securities in the form of UKG tokens. The plaintiffs also alleged the startup misled investors by promising the token's price would increase in the future.
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