The Securities and Exchange Commission have issued CoinAlpha Advisors LLC with a $50,000 fine and a cease and desist letter over an unregistered securities sale.

CoinAlpha formed a fund in October 2017 with the goal of investing in digital assets and cryptocurrency. It raised more than $600,000 after reaching out to potential investors.

While the fund did file a “Notice of Exempt Offering of Securities,” they were not eligible for the exemption and did not register anything else with the SEC.

The company are also accused of not making investors undergo know-your-customer (KYC) procedures. After being contacted by the SEC, they hired a third party to check the accreditation status of investors.

The order, published on Friday, stated that the company have reimbursed all fees to its investors after being contacted by the SEC.

“A total of 22 investors invested a total of $608,491 in the Fund. In October 2018, after being contacted by the Commission staff concerning the issues herein, CoinAlpha unwound the Fund, pursuant to the authority granted in the Fund’s Limited Partnership Agreement,” the order read.

The order does state that CoinAlpha cooperated with the SEC. As a result, the sanctions imposed are relatively tame, with a $50,000 penalty being paid to the regulator on top of reimbursements.

The clampdown on CoinAlpha, who have been barred from violating the Securities Act in the future, has been seen as another step in the SEC’s clampdown on cryptocurrencies. Before this, the regulator cracked down on ICOs Airfox and Paragon, forcing the start-ups to refund investors.

The SEC also fined EtherDelta founder Zachary Coburn, who paid $300,000 in disgorgement in addition to a $75,000 penalty.

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