The U.S. Securities and Exchange Commission tightens its ropes around the crypto industry.
Dragonchain, a decentralized hybrid blockchain platform, got sued by SEC for wrongfully raising $16.2M worth of funds through unregistered crypto asset securities offerings in 2017.
The chief architect of Dragonchain, John Joseph Roets was charged guilty of violating the regulatory laws.
Dragonchain was originally founded in 2016 to be Walt Disney Company’s private blockchain platform in Seattle.
SEC explained that the platform offered Dragon tokens $DRGN in a pre-sale to a crypto investment club for a discounted price, and through an initial coin offering held in October and November of 2017.
The US regulator shared that Dragonchain managed to raise $14 million from 5,000 investors from around the world.
$DRGN was promoted to crypto investors promising high value and prices to gain investment funds.
Between 2019 and 2021, the platform’s branches, Dragonchain, the Dragonchain Foundation, and The Dragon Company, tried to sell $2.5 million worth of DRGNs azto afford its business expenses.
Roets also questioned the SEC’s awareness of digital technology and how to regulate it.
Seeing the recent investigations against the crypto industry, SEC seems to be targeting ICOs held in 2017.