The US Securities and Exchange Commission has accused the founder of decentralized Ethereum currency exchange EtherDelta (DEX) of operating an unregistered exchanger.
Cryptocurrency marketplace DEX allowed users to trade Ethereum-based tokens without registering an account or depositing funds into a wallet controlled by the exchange. The trading process was carried out by a smart contract, although the exchange itself depended on off-chain infrastructure managed by the operator.
According to the SEC, the EtherDelta platform illegally allowed users to trade tokens that, in accordance with federal law, classified as securities.
“EtherData has both the user interface and core functionality of a national online exchange that is subject to registration with the SEC,” said Stephanie Avakian, co-director of the commission's enforcement division.
“The securities market is currently undergoing significant change and innovation through the use and application of distributed ledger technology,” said Stephen Peikin, Co-Director of the SEC's Division of Enforcement. “However, in order to protect investors and ensure compliance with laws, these innovations require close oversight by the SEC.”
Zachary Coburn, founder of EtherDelta, agreed to pay $300,000 in restitution, $13,000 in legal fees, and a $75,000 fine, although he neither admitted nor denied wrongdoing.
According to ccn.com
You May Also Like
Italian authorities protect investors from fraud
Italian authorities have taken measures to protect local investors by temporarily banning investments in two dubious crypto projects. In a special advisory, the National Commission for Social Affairs (CONSOB) identified a number of websites and Facebook pages where it has banned the sale of potentially counterfeit Bitsurge tokens and Green Energy certificates.
Chinese regulators will add crypto businessmen to the list of “unreliable persons”
The authorities of Inner Mongolia (an autonomous region in northern China) have developed a plan to implement the orders of the State Council to combat Bitcoin mining and trading.
