SEC Sues Ukyo, Founder of Defunct Bitcoin Securities Exchange BitFunder

The US Securities and Exchange Commission (SEC) on Wednesday charged defunct Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term ‎securities exchange BitFunder and its principle Jon E. Montroll with fraud, that saying they ‎operated an unregistered online securities exchange and concealed critical information while tapping the ‎market for millions of dollars‏.‏‎ ‎

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In a lawsuit filed in US federal court in Manhattan, the SEC said that the owner ‎of the Bitcoin venue Ukyo failed to disclose a cyberattack on BitFunder’s system that ‎resulted in the theft of more than 6,000 bitcoins. It also accused him with defrauding exchange users by misappropriating their assets.‎

The Bitcoin-denominated securities site, which launched in December ‎‎2012 and held around $16 million in assets, ceased operations ‎in 2013 and transferred out leftover bitcoins to users.‎

Bitfunder was one of the most interesting parts of the major cryptocurrency’s history because ‎it allowed startups to raise funding for their businesses in a manner that ‎may have been even easier than what is seen with the ICO ‎phenomenon currently.‎

By making misleading public statements, Montroll and his digital marketplace ‎sold unregistered securities, regardless of whether that activity involved ‎digital assets, tokens or coins, the SEC said. ‎

The SEC has warned for months that cryptocurrency and related fundraisers may ‎work as a way for scammers to illegally dodge the strict rules placed on regular ‎investments.‎ The warned investors against throwing money into ICOs because their organizers launch investment schemes without even attempting to follow US ‎securities laws.‎

Earlier last week, the SEC suspended trading in shares of three companies due to questions about ‎their recent PRs which advertised the buyout of cryptocurrency and ‎Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term-related assets.‎

Marc Berger, Director of the SEC’s New York Regional Office, commented: ‎“We allege that BitFunder operated unlawfully as an unregistered securities ‎exchange. Platforms that engage in the activity of a national securities exchange, ‎regardless of whether that activity involves digital assets, tokens, or coins, must register ‎with the SEC or operate pursuant to an exemption. We will continue to focus on these ‎types of platforms to protect investors and ensure compliance with the securities laws.” ‎

Lara Mehraban, Associate Regional Director of the SEC’s New York ‎Regional Office, added: ‎“As alleged in the complaint, Montroll defrauded exchange users by misappropriating their ‎bitcoins and failing to disclose a cyberattack on the exchange’s system and the resulting ‎bitcoin theft. We will continue to vigorously police conduct involving distributed ledger ‎technology and ensure that bad actors who commit fraud in this space are held ‎accountable.”