Tokens sold by Centra Tech are recognized as Securities

The blockchain firm Centra Tech, well-known by some celebrity approvals, has had its tokens ranked as securities by the US Securities and Exchange Commission
28 June 2018   1019

In April two founders of Centra Tech were arrested by US authorities. It raised $32 million by falsely claiming to be developing a cryptocurrency debit card in partnership with Visa and Mastercard. Actually, the executive team on the website was fictitious and no such products were being developed. 

We allege that the Centra co-founders went to great lengths to create the false impression that they had developed a viable, cutting-edge technology.
Robert A. Cohen
SEC Cyber Unit Head 

The ICO was promoted by retired boxer Floyd Mayweather and rap musician DJ Khaled. They are not supposed to be involved in the conflict. Lately, Judge Andrea Simonton of the Southern District of Florida court has considered that the tokens sold in the ICO are securities. It has to be marked that the defendents do not contest this point.

According to US law, the determination of a security is: “An offering is an investment contract if there is: (1) an investment of money (2) in a common enterprise, (3) with the expectation of profits to come solely from the efforts of others.”

This investment shouldn`t be cash, but can take the form of assets, as long as the investor commits them “to an enterprise or venture in such a manner as to subject himself to financial losses.” The existence of a common enterprise must then be set up - “a common enterprise exists where the fortunes of the investor are interwoven with and dependent upon the efforts and success of those seeking the investment of third parties.”

Simonton viewed this satisfied as “the fortunes of individual investors in the Centra Tech ICO were directly tied to the failure or success of the products the Defendants purported to develop. An individual investor could exert no control over the success or failure of his or her investment.”

The definition of a security is set and the punishments can start flowing. The defendants did not register their security, they sold their tokens in various states, the plaintiffs have suffered from financial losses.

Binance Launchpad to Change IEO Rules

Binance is going to implement the lottery format for the next tokensale campaign
25 March 2019   39

Binance announced a change in the format of the next tokensale on the Launchpad platform to a lottery. At the same time, the number of lottery tickets per account will depend on the size of the steak in the BNB for 20 days before IEO.

Note that one account can get up to 5 lottery tickets. Winners will be selected by randomizer.

BNB Balance to Lottery Tickets Ratio
BNB Balance to Lottery Tickets Ratio

It is noteworthy that within 20 days before the lottery, the BNB-deposit snapshot will be carried out daily at 0:00 UTC to monitor the fulfillment of the conditions.

Each winning ticket will grant the right to purchase tokens for a fixed amount in BNB equivalent. As soon as the user informs the exchange that he is ready to use a certain number of tickets in case of their winnings, this obliges him to purchase tokens and the money will be debited automatically.

Binance acknowledged that the price of BNB may fluctuate due to daily snapshots, and its potential decline may not be covered by the benefit from the new token, and encouraged users to make informed decisions.

In addition, Changpeng Zhao urged the community to comment on the new format in a separate Twitter thread in order to make the necessary feedback-based changes, if needed.

During the Celer Network tokensale on the Launchpad platform again had bandwidth problems; many people did not manage to purchase tokens.