US SEC, which had suspended the ICO of decentralized exchange Blockvest, has received a blow from a US Federal Court. The court has reversed SEC’s order and denied the injunction requested by the SEC.
It’s no secret by now that US Securities and Exchange Commission wants almost every ICO on earth to be issued under securities law. It has made that clear many times, and it has also investigated hundreds of ICOs for the same purpose. However, its efforts have received a major setback from a Federal Court as one of the ICOs it had branded as security has now been cleared of the charge.
Blockvest decentralized digital assets exchange had issued an ICO back in October, and SEC had suspended the ICO through an emergency court order. Blockvest had appealed against the suspension at a US Court, and the legal battle that ensued has now ended with court announcing a verdict in favor of Blockvest. The court said in its verdict that SEC had failed to adequately demonstrate in its investigation that BLV tokens were unregistered securities under US law. The court said:
“At this stage, without full discovery and disputed issues of material facts, the Court cannot make a determination whether the BLV token offered to the 32 test investors was a ‘security’. Thus, Plaintiff [the SEC] has not demonstrated that the BLV tokens purchased by the 32 test investors were ‘securities’ as defined under the securities laws.”
Concluding his remarks in the verdict, Judge Gonzalo P. Curiel denied the request of SEC for an injunction order against Blockvest. Essentially what this means is that SEC will now have to be more careful while banning an ICO on the grounds of being a security. Kudos to Blockvest for taking on the big brother!
In the meantime, our Indian Supreme Court has been delaying the case of cryptocurrencies endlessly. It doesn’t seem to be in their priorities at all. The next date for hearing has now been set to 15th of January 2019.