18 Nov 2022
The SEC has moved to halt the sale of American CryptoFed DAO tokens.
The Securities and Exchange Commission has opened an investigation into American CryptoFed as part of its ongoing administrative proceedings.
The Securities and Exchange Commission has initiated administrative proceedings against American CryptoFed, a Wyoming-based decentralized autonomous organization (DAO), to consider a stop order to suspend the registration of its Ducat and Locke tokens.
According to the SEC, American CryptoFed failed to include required information about the company's business, management, and financial condition in a Form S-1 registration statement filed last year.
The statement also contained "materially misleading statements and omissions, including inconsistent statements about whether the tokens are securities," according to the agency.
"An issuer seeking to register the offer and sale of crypto assets as securities transactions must provide the SEC with the required disclosure information," said David Hirsch, chief of the enforcement division's crypto assets and cyber unit. "American CryptoFed failed to comply with the federal securities laws' disclosure requirements, but it also claimed that the securities transactions they seek to register are not securities transactions at all."
According to the SEC, Martin Zerwitz and Michael Baker of the SEC's crypto assets and cyber unit conducted the investigation.
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