US State Regulators Hit BitConnect With Second Cease-And-Desist

North Carolina became the second state to halt BitConnect's ICO after issuing a temporary cease-and-desist.

AccessTimeIconJan 11, 2018 at 6:00 p.m. UTC
Updated Aug 18, 2021 at 7:54 p.m. UTC

Presented By Icon

Election 2024 coverage presented by

Stand with crypto

BitConnect's planned initial coin offering (ICO) has attracted another cease-and-desist letter from U.S. state regulators, marking the second time this month.

In a release dated Jan. 9, the regulators from the North Carolina Securities Division outlined the temporary cease-and-desist, stating that BitConnect hadn't registered to deal or sell securities in the Tar Heel State.

  • Bitcoin Mining in the U.S. Will Become 'a Lot More Decentralized': Core Scientific CEO
    13:18
    Bitcoin Mining in the U.S. Will Become 'a Lot More Decentralized': Core Scientific CEO
  • Binance to Discontinue Its Nigerian Naira Services After Government Scrutiny
    05:10
    Binance to Discontinue Its Nigerian Naira Services After Government Scrutiny
  • The first video of the year 2024
    04:07
    The first video of the year 2024
  • The last regression video of the year 3.67.0
    40:07
    The last regression video of the year 3.67.0
  • According to the release, the division determined that BitConnect had planned to sell unregistered securities in their initial coin offering (ICO), which was scheduled to launch on Jan. 10.

    The release continued:

    “The Temporary Order to Cease and Desist found that BitConnect was not registered as a dealer or salesman of securities in North Carolina and offered investments called the BitConnect Lending Program and the BitConnect Staking Program. The Temporary Order to Cease and Desist also found that BitConnect had omitted to disclose material facts when offering these investments in North Carolina.”

    BitConnect has 30 days to respond, according to the temporary cease-and-desist notice. If the company fails to do so, the temporary order will become permanent, according to the release.

    Last week, the Texas State Securities Board issued a similar statement regarding BitConnect, which some critics have accused of constituting a Ponzi scheme.

    Like their counterparts in North Carolina, the Securities Board issued a temporary cease and desist order, stating that cryptocurrencies are "risky investments."

    North Carolina image via Shutterstock

    Disclosure

    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information have been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. CoinDesk has adopted a set of principles aimed at ensuring the integrity, editorial independence and freedom from bias of its publications. CoinDesk is part of the Bullish group, which owns and invests in digital asset businesses and digital assets. CoinDesk employees, including journalists, may receive Bullish group equity-based compensation. Bullish was incubated by technology investor Block.one.


    Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.