By crypto.news | Created at 2024-11-21 11:21:31 | Updated at 2024-11-23 10:17:16
1 day ago
The U.S Securities and Exchange Commission distributed funds amounting to $4.6 million to investors involved in BitClave’s initial coin offering.
The SEC announced in a recent filing that it has authorized the transfer of more than $4.6 million to “harmed investors” in accordance with the return plan for BitClave’s Ethereum-based search engine ICO.
“After a notice & claims process, investors will now be receiving their share of the BitClave Fair Fund,” the SEC wrote in an X post.
Through its brief 32-second ICO, BitClave sold out its Consumer Activity Token to 9,500 investors and raised around $25.5 million. In 2020, the SEC sued crypto startup BitClave over allegations that it had violated the securities law by failing to register its ICO as a digital asset security.
BitClave did not admit to any wrongdoings, but it did reach a settlement with the SEC. As part of the settlement deal, BitClave agreed to return the entirety of its ICO sales of $25.5 million. It was also required to pay $3.4 million in pre-judgment interest as well as a $400,000 fine.
Additionally, the startup agreed to destroy its 1 billion uncirculated CAT token supply and delist the token from exchanges.
In addition to paying damages, the SEC ordered BitClave to establish a Fair Fund to facilitate returns for the investors who participated in the ICO.
According to the filing, investors requesting a return had to file claims before the deadline that was set for Aug. 2023. The notifications on claim statuses were sent out in March this year.
BitClave vowed to contribute $29 million to the SEC’s Fair Fund for investor compensation. However by Feb. 2023, BitClave only managed to shill out $12 million for investor compensation, according to information on the SEC document detailing BitClave’s Fair Fund.
BitClave’s case is just one of many lawsuits that the SEC has weighed against crypto industry players in the past few years. Ripple Labs, Binance and Coinbase are among the many crypto firms that have also faced scrutiny for alleged unregistered securities operations and fraudulent practices.
As previously reported by crypto.news, throughout 2024 law enforcement agencies settled eight lawsuits for $19.45 billion by October 2024. Despite the year not being over, the settlement value in 2024 has already increased by 78.9% compared to the previous year.
