50 million USD ICO puts SALT Lending in jeopardy

50 million USD ICO puts SALT Lending in jeopardy
Nov 18, 2018 by Rico Wise

According to the reports from the Wall Street Journal, the SEC had previously issued a subpoena to SALT inquiring about its 50 million USD ICO, carried out in 2017 in the wake of the token sale boom.

Anonymous sources mentioned in the report claim that the Commission was assessing if the SALT’s token sale can be considered an illegal offering of securities, including the ways the company disposed of the ICO profits and the distribution of SALT coins to the investors.

The firm has confirmed receiving a subpoena pointing that it happened when the SEC had doubled down on dozens of digital currency projects that engaged in fundraising via token sales, considered by the Commission to be unregistered securities offerings.

Furthermore, SALT appears to have more issues to deal with, as the report also points at ex-financial officer of the company, who filed a lawsuit versus the company, alleging that the firm suffered a 4 million loss in digital currency subsequent to a cyber attack in February, as well as provided favorable loan conditions to firm executives and their families.

The SEC is also inquiring into the possibility of violations committed by Erik Voorhees, who previously served as an adviser and a board member of SALT Lending. Specifically, the Commission is looking into the 2014 settlement, according to which Voorhees was restricted from taking part in any issuance of any security in an illegal transaction in turn for any digital asset, such as BTC for a five years’ period.

The settlement partially derived from charges connected with his management of BTC gambling site called SatoshiDICE, which was one of the first successful digital currency services. The SEC charged Voorhees with engaging into illegal securities offering subsequent to Voorhees allowing financiers to utilize BTC purchase shares in SatoshiDICE and other firm.

Anyway, the subpoena does not seem to make the SALT terminate its intentions of expansion, as the company keeps opening its services in new countries and includes more digital currency collateral options on its platform even after the SEC’s probe has been initiated.