Unicoin CEO Alex Konanykhin rejects SEC’s attempt to settle enforcement probe, claiming it has inflicted multi-billion-dollar damages on investors and token holders.
Unicoin CEO Rejects SEC’s Attempt to Settle Enforcement Probe
In a letter to shareholders on Tuesday, Unicoin CEO ‘multi-billion-dollar damages’ was stated by Alex Konanykhin, that the SEC’s investigation has inflicted on its investors and token holders. The company has rejected the SEC’s attempt to negotiate a settlement agreement over an ongoing probe into alleged securities violations.
Unicoin is a cryptocurrency that was launched in 2014, claiming to be the first-ever cryptocurrency backed by gold reserves.
The project aimed to provide a stable store of value and medium of exchange by pegging its value to the price of gold.
However, the project faced significant controversy and criticism due to concerns over its lack of transparency and regulatory compliance regarding Unicoin.
Background of the Investigation
Unicoin received a Wells notice from the SEC in December, indicating potential enforcement action for alleged securities violations. The investigation was initiated shortly before former Chair Gary Gensler stepped down, alleging violations related to ‘fraud’ , deceptive practices, and the offer and sale of unregistered securities. No official enforcement action has yet been filed.
The Securities and Exchange Commission (SEC) is a US government agency responsible for protecting investors, maintaining fair and efficient markets, and facilitating capital formation.
The SEC enforces federal securities laws, including the Securities Act of 1933 and the Securities Exchange Act of 1934.
Key regulations include filing requirements for public companies, disclosure rules, and anti-manipulation provisions.
The SEC also oversees industry professionals, such as broker-dealers and investment advisers, to ensure compliance with regulatory standards.
Rejection of Settlement Negotiation
Konanykhin claimed that the SEC’s actions have significantly harmed Unicoin‘s financial prospects. He stated that the company was given an ‘ultimatum’ by the SEC to attend a settlement negotiation meeting on April 18, but declined to show up due to demands made by the SEC that he found ‘unacceptable.’ Konanykhin refused to share specifics about the communication between Unicoin‘s lawyers and the SEC.
Impact of the Investigation
Konanykhin claimed that the SEC’s probe has caused ‘multi-billion-dollar damage’ to Unicoin and its investors. He stated that if the SEC had not blocked Unicoin‘s ICO, stock exchange listing, and fundraising, the company would likely be a $10B+ publicly traded company by now.
Shift in Crypto Regulation
The SEC’s stance on crypto regulation has changed since President Donald Trump took office. The agency has reversed its once-aggressive approach, backing off from many of its open investigations into crypto companies. However, other enforcement cases against crypto companies remain ongoing, including cases against Binance and Tron.
