SEC states that the ICOs Paragon and AirFox have to refund $12 million and $15 million respectively to investors. The two companies sold digital tokens in initial coin offerings but violated securities offering registrations. Both companies agree to return funds to harmed investors and register the tokens as securities instead of utilities.
According to the SEC’s orders, both CarrierEQ Inc. (Airfox) and Paragon Coin Inc. conducted ICOs in 2017. They raised money through ICOs even though the commission warned startups to follow regulation, according to the report of Investigation. Airfox, a Boston-based startup, raised approximately $15 million worth of digital assets. They raised the money to finance its development of a token-denominated ecosystem. Starting with a mobile application that would allow users in emerging markets to earn tokens and exchange them for data. Paragon, an online entity, raised approximately $12 million worth of digital assets to develop and implement its business plan. Neither Airfox nor Paragon registered their ICOs under the federal securities laws. Nor did they qualify for an exemption to the registration requirements.
Read my full article here: https://toshitimes.com/secs-new-ruling-could-send-many-crypto-icos-to-bankruptcy/