BitConnect tokens banned in Texas

Emergency Cease and Desist Order released by The Texas Securities Commissioner against Bitconnect for the selling of unlicensed securities
05 January 2018   215

The Texas Securities Commissioner issued an Emergency Cease and Desist Order on Jan. 4 against Bitconnect for the selling of unlicensed securities. This is reported by Cointelegraph.

The Securities Commissioner found that the BitConnect investments are securities, but were not registered as required by the Texas Securities Act and State Securities Board Rules and Regulations. In addition, the company is not registered to sell securities in Texas.
 

Texas State Securities Board

According to the project description, BitConnect promises investors an income of 100% per annum or more.

BitConnect has disclosed virtually nothing about its principals, financial condition, or strategies for earning profits for investors. It has not provided a physical address in England.
Despite providing no information on how it will make money for investors – including the algorithms behind the Trading Bot – BitConnect is touting its investments as a “safe way to earn a high rate of return.
Investing in cryptocurrencies, however, carries significant risk because of regulatory and legal actions, competition from other cryptocurrencies, and the extreme volatility in the price of many cryptocurrencies.
 

Texas State Securities Board

Previously, many bitcoins-enthusiasts accused BitConnect of being a financial pyramid, including co-founder Ethereum Vitalik Buterin wrote on Twitter that the promise of a certain income indicates that this project is a scheme of Ponzi.

US Court Freezed BitConnect Assets

Funds freezing is the answer of second lawsuit against BitConnect
01 February 2018   82

The US court imposed a temporary ban on the accounts of the crypto project BitConnect, according to which all assets of the company should be frozen. It is 'the answer" to the second collective lawsuit filed against the company, Coindesk reports.

The resolution obliges respondents to disclose the addresses of the cryptocurrency wallets and trading accounts of BitConnect, as well as the identity of all to whom the company sent digital assets within the last 90 days.

The defendants have 10 days to execute the order. In addition, BitConnect International PLC, BitConnect LTD, BitConnect Trading LTD and Ryan Maasen are prohibited from transferring any assets without separate court authorization.

On the eve of these events, a resident of Kentucky, Brian Page sued BitConnect International, BitConnect LTD, BitConnect Trading LTD and Ryan Maasen, Oklahoma resident, who promoted the project.

Page is demanding compensation for losses to all investors who lost money after the closure of the cryptocurrency exchange and credit programs under pressure from the state regulators of Texas and North Carolina. The rate of BCC coins fell by 98.8% from the absolute maximum reached in December, and at the moment is about $ 6.

As a result, the court considered that the plaintiffs will not have a chance to recover their funds if the BitConnect assets are not frozen, and the temporary ban was imposed "in the public interest, because the public is interested in preventing mass fraud and other violations of securities laws."