The SEC reportedly filed a lawsuit against an alternative cryptocurrency startup in 2017 related to the launch of its initial coin offering.
In 2017, the SEC claimed that Quantstamp, a blockchain security business, had conducted an unregistered initial coin offering. The corporation has consented to pay the fine and reimburse the shareholders.
The US Securities and Exchange Commission (SEC) has charged California-based smart contract auditing service provider Quantstamp with offering unregistered securities in the form of its QSP tokens.
The SEC issued a statement saying it has filed a criminal complaint against Quantstamp for its ICO in October and November 2017, during which it raised over $28 million from approximately 5,000 investors.
The SEC has said that QSP coins are securities under the Howey test and that Quantstamp did not register its ICO as required by federal securities laws.
Without admitting or rejecting the SEC’s allegations, Quantstamp has reached a settlement with the agency. A $1 million civil penalty, pre-assessment interest of $494,314, and a $1 million indemnification will be paid by the corporation. Both the QSP’s registration as a security under the Securities Exchange Act of 1934 and the refund of any unsold tokens to investors will occur.
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