Cryptocurrency start-up Gladius has self-reported itself to the SEC for violating securities laws in its initial coin offering (ICO) in October 2017.
The company raised $13 million in its ICO, all of which will now have to be returned to the initial investors.
Unlike in the Airfox and Paragon cases, who were each subject to a $250,000 fine, the SEC is not imposing a penalty on Gladius due to the company taking “significant steps” to remediate the violation.
According to a press release, the charges have now been settled.
It stated: “The Commission is not imposing a penalty because of the significant steps Gladius took to remediate the violation. Gladius, which was evaluating the applicability of the federal securities laws to its ICO, self-reported to staff in the Commission’s Division of Enforcement in the summer of 2018, and informed Commission staff that it wanted to do what was necessary to take prompt remedial steps. It cooperated with the staff’s investigation, providing information quickly and in a form useful to the staff.”
Gladius will now have to register with the SEC as a security, as well as refund customers. The price of the project’s token (GLA) has tumbled on the news, falling more than 50%, with the market cap dropping below $500,000.
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