The regulator is seeking a court injunction against the project, compensation for damages to investors with interest, and civil penalties

SEC sues Dragonchain blockchain project founder

17.08.2022 - 14:15

220

1 min

What’s new? On August 16, the US Securities and Exchange Commission (SEC) brought charges against entities associated with the Dragonchain crypto project and its founder and controlling person, John Joseph Roets. According to the SEC, Roets, Dragonchain Inc, Dragonchain Foundation and Dragon Company conducted an unregistered initial coin offering (ICO) of DRGN. The regulator claims that the defendants illegally raised $16,5 million by doing so. The SEC seeks an injunction against the project, compensation for damages to investors with interest, and civil penalties.

SEC's lawsuit

What else does the lawsuit say? Most of the funds — $14 million — were raised in the first stage from about 5 000 investors around the world in 2017. Between 2019 and 2022, defendants sold $2,5 million worth of DGRN tokens to develop and promote Dragonchain technology and cover business expenses.

The open-source Dragonchain platform was founded in 2016. It is used by businesses and developers to integrate with Bitcoin, Ethereum, Binance Chain and Ethereum Classic blockchains. The founder and CEO of the platform is John Joseph Roets. The project's native token is DRGN. The asset is trading at $0,022 as of 14:30 UTC, down 12,65% in 24 hours, according to cryptocurrency exchange Binance.

In June, the SEC launched an investigation into Binance and its BNB native token. The regulator intends to find out whether the platform violated securities sales rules in the 2017 ICO. The regulator also initiated an audit of the Binance.US subsidiary to determine whether its operations are correctly separated from the global company.

Subscribe to Getblock Magazine and stay up to date with the latest news from the world of cryptocurrencies and the digital economy