US DAO to Battle SEC Without Solicitor
The American CryptoFed DAO is about to fight a legal battle with the US Securities and Exchange Commission (SEC). It will become the country's first authorised decentralised autonomous organisation to do so. The issue is token registration, which the regulators approved in 2021.
But now, the SEC has announced that the US DAO provided “misleading” information for the public offering of its tokens. It further accused the organisation of non-compliance in the investigation procedure. So, the regulatory authority will initiate an administrative proceeding against the firm.
Accusations from the regulators
The Enforcement Division of the crypto watchdog stated that the company provided incomplete information in Form S-1. It did not provide audited financial statements and other necessary documents related to its operations. Moreover, the statements seemed inconsistent and misleading regarding the nature of its tokens.
Regulators noted that the CryptoFed tokens might fall under securities laws. The firm also failed to cooperate with the regulatory body, it is alleged. Therefore, they may have to cancel the registration for their tokens.
US DAO not to take assistance from an attorney
The US DAO, CryptoFed, has decided to fight the case without taking assistance from a legal advisor. It successfully registered two of its tokens in 2021 with the regulators. One was a stablecoin, Ducat, and the second was an interdependent governance token, Locke.
Cointelegraph has reported remarks from the COO and organiser of the firm, Xiaomeng Zhou. He confirmed it has lodged the notice of appearance per the SEC’s regulations. It also reports that the firm will represent itself in court without a solicitor.
CryptoFed may also apply for an extension in the deadline to prepare its answer. If the application gets approved, the firm will likely get an extension of around 20 days to defend its stance.
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