The U.S. Securities and Exchange Commission (SEC) filed a case against the Founder and Chief Executive Officer of DragonChain, John Joseph Roets, to raise $16.5 million by selling unregistered crypto asset securities offerings.
The case filed in the U.S. District Court for the Western District of Washington also charged other “three entities”, Dragonchain Inc. (“Dragonchain”), Dragonchain Foundation (the “Foundation”), and The Dragon Company (“TDC”).
In a complaint, the SEC allegedly stated that Roets, DragonChain, and The Foundation sold an unregistered offering of Dragon tokens (DRGN) to around 5,000 investors in 2017.
The sale was conducted in two different phases. In August 2017, DragonChain conducted a presale of DRGN tokens for members of a crypto investment club.
Also Read: SEC Probes Coinbase over Crypto Yield, Staking Products
Another selling for DRGN tokens was conducted through Initial Coin Offering (ICO) for crypto investors in October and November 2017.
Roets raised around $14 million from these two offerings combined.
The filing states, “the defendants marketed the offering to crypto investors, and their personnel and agents publicly discussed DRGN’s investment value, pricing, and “listing” on trading platforms, among other things.
Apart from this, the defendants again offered and sold around $2.5 million worth of DRGN tokens “to cover business expenditures to further develop and market Dragonchain technology”.
