The U.S. securities watchdog has halted trading in the stocks of a cryptocurrency-related company, called Bitcoin Generation (BTGN), because of confusion over the nature of its business operations and the value of their assets.
Founded in 2017, the lesser-known firm develops Blockchain applications, crypto mining, and trading products. It says on its website that it owns 21 million of its native token, which operates on ERC20 protocol on the Ethereum network.
The Securities and Exchange Commission has suspended trading in the Oklahoma-based company amid questions surrounding statements it made about its outstanding common stock and promotional activity, the SEC announced on Monday. The SEC also cited concerns about press releases BTGN issued “regarding the viability and valuation of a bond that BTGN purportedly acquired from an entity based in the United Kingdom.”
However, the suspension is temporary, beginning on April 29 and ending on May 10, 2019.
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This is not the first time a blockchain-related company got in trouble due to a foray into the cryptocurrency-inspired technology.
Many crypto firms slapped with SEC’s suspension notices
Last year, the US securities watchdog also suspended another company tied distantly to the cryptocurrency industry after temporarily halting trading in shares of CIAO Group, citing concerns over the Nevada technology company’s planned initial coin offering (ICO).
Also last year, the regulator insisted on the name changes for the first Blockchain ETFs as investors seem desperate for any kind of blockchain exposure, to the point where many startups that put the word blockchain, or other cryptocurrency terms, into their name have seen their share prices soar.
The US regulators have taken enforcement actions, too, with a dozen companies having put their offerings on hold after the SEC issued warnings. Further, the agency froze assets of several cryptocurrency firms, halted ICOs and suspended trading in companies that claimed cryptocurrency or blockchain dealings.
Putting cryptocurrency companies and their advisers on notice, however, failed to chill the booming market. The recent clampdown comes just as titans of U.S. cryptocurrency operators are in a race to build the nation’s first regulated venues for tokens deemed to be securities.