The United States Securities and Exchange Commission (SEC) has gone after another cryptocurrency company and it’s related entities for conducting unregistered crypto offerings. The SEC has filed charges against entities related to Dragonchain including their founder, John Joseph Roets for selling unregistered securities.


The Securities and Exchange Commission filed this complaint in the United States District Court for the Western District of Washington on Tuesday, 16th August 2022. According to the SEC, John Roets and his three companies – Dragonchain Inc., Dragonchain Foundation, and the Dragon Company – illegally made $16.5 million through the sales of unregistered DRGN tokens.


A significant portion of the amount – $14 million – was raised in an initial coin offering (ICO) in 2017 from about 5,000 investors globally. The defendants also sold $2.5 million worth of DRGN tokens between 2019 and 2022 to take care of their business expenses while developing and promoting the Dragonchain technology.


Following the defendants’ violation of federal securities laws, the Securities and Exchange Commission is seeking “permanent injunctions, disgorgement with prejudgment interest, civil penalties against and conduct-based injunctions against each defendant” as stated in their court filing.


This latest lawsuit is similar to the lawsuit which the Securities and Exchange Commission filed against Ripple back in December 2020. The regulators accused Ripple, CEO Brad Garlinghouse and co-founder Chris Larsen of conducting an unregistered securities offering of up to $1.3 billion. The defendants refuted the regulators’ claims, stating that XRP is not a security.


While the legal battle between the SEC and Ripple is still ongoing, the securities regulator launched a probe on Coinbase. The regulators are claiming that some of the assets that are offered by and listed on the platform are unregistered securities.


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