In 2020, the SEC filed a suit against Ripple and its current and former CEOs, claiming that selling XRP (a network on which transactions sped across the globe in the form of a cryptocurrency) constituted the offering of unregistered security — essentially an illegal IPO.
In 2019, the Commission fined Block.one, the EOS blockchain developer, $24 million for an unregistered ICO. According to the financial regulator, the firm violated federal securities laws and did not apply for an exemption from registration requirements.
Telegram Open Network (TON) was a blockchain-based decentralized computer network initiated by Pavel Durov, a founder of Telegram messenger. Together with his brother, he attracted investments of several billion dollars for this project and planned to transfer their popular Telegram messenger completely to TON.
On May 12, 2019, Pavel Durov, head of the Telegram Open Network blockchain platform, announced the termination of TON development in his blog. Pavel indicated the decision of the Commission as the main reason for the project’s closure.
The SEC sued John McAfee, the developer of the namesake anti-virus software, claiming he received over $23.1 million in unreported remuneration for endorsing seven cryptocurrency offers on Twitter that were materially false and deceptive.
As an outcome, Ripple and EOS managed to negotiate a settlement with the SEC, even though the Ripple investigation is still in progress. Telegram was forced to return the investors’ money and leave the US financial market, as well as drop the Telegram Open Network project. Finally, John McAfee was sentenced for promoting the malicious ICO.