The U.S. Securities and Exchange Commission (SEC) achieved a legal victory against a company in connection with an initial coin offering (ICO) in 2017.
On September 30, Massachusetts federal judge Mark Mastroianni ruled, that Rivetz Corp and its CEO Steven Sprague sold unregistered securities in the form of the ethereum-based Rivetz Tokens (RvT) to US investors.
In 2021, the Securities and Exchange Commission (SEC) filed a lawsuit against Rivetz and Sprague alleging that they raised $18 million by selling RvT tokens to over 7,200 investors, one-third of whom were U.S.-based.
Sprague, who represented himself, claimed the tokens were a software product and not an investment contract. But the court found that Rivetz’s claims tied the token’s value to the company’s efforts to create a security ecosystem for mobile devices, thus meeting the criteria of the Howey test that defines securities.
Judge Mastroianni noted that while the RvTs were functional as ERC-20 tokens, they had no inherent value beyond their future potential within the Rivetz ecosystem. The court concluded that token purchasers had an expectation of profits based on Rivetz’s entrepreneurial activities, further solidifying the token’s classification as a security.
The SEC must now file a motion for injunctive and monetary relief by October 22. This ruling follows a similar SEC case against Opporty International, which was found guilty of selling unregistered securities in an ICO worth $600,000.
An acclaimed journalist recognized for exposing human trafficking and cryptocurrency scams in Cambodia has been detained by the country’s military police.
The Australian Federal Police (AFP) have seized $6.4 million in cryptocurrency linked to an international crime syndicate during Operation Kraken, resulting in the arrest of Jay Je Yoon Jung.
The third quarter of 2024 has seen a notable decline in the number of reported cryptocurrency hacks, yet the total value of stolen assets has surged.
A 21-year-old man has admitted guilt in a federal court to charges connected to a significant cryptocurrency theft exceeding $37 million, as announced by the U.S. Department of Justice (DOJ).