Texas Regulator Orders BitConnect to Call Off Token Sale

Revenue brokers were “targeting Texas inhabitants,” and residents of other states, the TSSB explained.
Moreover, BitConnect was searching for recruiters to market its token, and also the Texas agency decided qualify as brokers that aren’t registered to sell securities in Texas.

According to a news release published on the regulator’s website, BitConnect was claiming to provide tokens with 100% annual returns, and also the TSSB decided qualify as unregistered securities.
Texas ranger picture via Shutterstock
BitConnect announced on Jan. 1 that it would be launch an initial coin that (ICO) known as BitConnectx on Jan. 10. And notably, the startup had ran a previous token deal in 2016.
The Texas arrangement, however coming out of a state-level jurisdiction, highlights another example where regulators in the U.S. are inspecting cryptocurrency projects which might be regarded as issuing unregistered securities through the token offering procedure.

The Texas launch also contained a warning against cryptocurrencies in general:
“Purchasing cryptocurrencies … conveys significant risk due to legal and regulatory activities, competition from other cryptocurrencies, and also the volatility in the cost of many cryptocurrencies.”

The Texas State Securities Board (TSSB) has arranged the blockchain-based financial system startup BitConnect to cancel a token sale it’d intended to begin on January 10.

But this hasn’t stopped the company from asserting to be a secure investment, according to the release.
Moreover, the release by TSSB went on to say that BitConnect hasn’t shared any information regarding its financial status, the way that it will make a profit or even its specific location.
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The coin has been decreasing in value over the last week from a high of $460 on Dec. 30, 2017.

BitConnect did not immediately respond to a request for comment.

Previously,  the Securities Exchange Commission  halted   a token offering from Munchee, after which the job provided refunds for investors.