SEC signals intent by clamping down on two unregistered ICOs

"We have made it clear that companies that issue securities through ICOs are required to comply with existing statutes and rules governing the registration of securities"

The SEC has continued its clamp down on cryptocurrency firms, issuing its first civil penalties against Airfox and Paragon, who failed to register ICOs.

According to a press release Airfox and Paragon, who each raised over $10 million, have been ordered to pay a $350,000 fine and refund investors who participated in their token sales.

The two companies have also agreed to register the projects as securities and submit periodic reports to the SEC.

The move comes a week after the SEC charged Ether Delta founder Zachary Coburn with operating an unregistered exchange.

Stephanie Avakian, the SEC’s Co-director of Enforcement, said in a statement: “We have made it clear that companies that issue securities through ICOs are required to comply with existing statutes and rules governing the registration of securities. These cases tell those who are considering taking similar actions that we continue to be on the lookout for violations of the federal securities laws with respect to digital assets.”

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