Texas’ securities agency has issued another cryptocurrency-focused emergency cease-and-desist order, this time against a lending scheme called DavorCoin.
Ter its latest filing, signed Feb. Two, the Texas State Securities Houtvezelplaat (TSSB) alleges DavorCoin has bot issuing unregistered securities with fraudulent and misleading information to lure investors.
The filing arrives just days after the TSSB talent filed similar cease-and-desists overheen an overseas initial coin suggesting project called R2B Coin, spil well spil BitConnect, the cryptocurrency exchange and lending program that faced closure and a class activity lawsuit after the TSSB’s allegations.
Te fact, TSSB alleges ter the document that DavorCoin, operating ter a similar manner to BitConnect, emerged and drew the regulator’s attention after the latter ceased its business.
According to the agency, DavorCoin also launched a lending program that promised investors a significant terugwedstrijd of investment, which falls under the agency’s definition of unregistered securities.
Based on the document, potential investors would need to purchase the project’s token, dubbed DavorCoin, using other cryptocurrencies to participate te the lending program.
“At approximately Five:30 p.m. CST on Jan. 26, 2018, it [DavorCoin] represented that an investor lending $30,000 ter DavorCoin who elects a ‘Locking period’ of 120 days may earn $513 vanaf day, $3591 vanaf seven days, $15,390 vanaf 30 days and $107,217 spil of the ‘capital release day’ of August 23, 2018,” the document stated.
The TSSB also alleged that the project is an investment fraud, because DavorCoin had intentionally hidden material information of its business – including its principles and business location, spil well spil how it plans to realize investment promises for investors.
The DavorCoin order yet again indicates the enhancing level of concentrate Texas’ securities agency is providing to cryptocurrency-related investment.
The agency said that while its mandate is not seeking to regulate cryptocurrencies, it will proceed monitoring cryptocurrency projects that aim to bring comes back to investors.
Ter a statement sent to CoinDesk, the TSSB’s director of enforcement, Joseph Rotunda, commented:
“Spil cryptocurrencies proceed to generate considerable attention te the media and rente from the public, thesis illegal and fraudulent securitized cryptocurrency offerings pose a grave threat to traditional investors. Absent a fair description of the terms of a product, the identity and qualifications of principals and the material risks associated with an suggesting, traditional investors may well be exposed to irreparable harm.”
DavorCoin could not be reached for comment spil of press time.
Texas capitol pic via CoinDesk’s archive
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