A U.S. federal court in Massachusetts ruled on Monday that Rivetz Corp. violated securities laws by conducting an illegal sale of unregistered securities. The court sided with the Securities and Exchange Commission (SEC), determining that Rivetz and its founder had unlawfully offered and sold unregistered digital tokens between 2017 and 2018.
Rivetz’s ICO Found to Violate Securities Laws
Court documents reveal that Rivetz raised approximately $18 million through the sale of its RvT tokens, which were marketed as a utility for securing devices and data via blockchain technology. However, the SEC argued that these tokens were sold as investment contracts without meeting the necessary registration requirements.
Despite Rivetz’s claims that the tokens were crucial for platform security, the SEC found that the company failed to deliver on its technological promises during the initial coin offering (ICO). The court concluded that Rivetz had misled investors into believing they were purchasing securities tied to the company’s future success, thus violating the Securities Act of 1933.
Mango DAO Pays $700,000 to Settle with SEC
In a separate case, Mango DAO settled with the SEC over charges related to the unregistered sale of its MNGO tokens. The DAO agreed to pay $700,000 in fines after the SEC determined that the MNGO tokens qualified as securities under U.S. law, even though they were issued within a decentralized autonomous organization.
As part of the settlement, Mango DAO agreed to halt trading of its MNGO tokens on exchanges and destroy any remaining tokens. Additionally, the SEC reached a separate settlement with Mango Labs LLC, a developer associated with the DAO, over unregistered broker activity. Both parties resolved the charges without admitting or denying the allegations.
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