FINMA: $90 million Envion AG ICO is “illegal”
- As per FINMA, Envion AG didn’t follow the necessary statutory licensing requirements.
- More than 37,000 investors participated in the token offering.
The Swiss Financial Market Supervisory Authority (FINMA) declared that the initial coin offering (ICO) of crypto mining firm Envion AG is illegal and “seriously violated supervisory law.” As per FINMA, the ICO, which raised 90 million USD and attracted more than 37,000 investors in early 2008, didn’t follow the necessary statutory licensing requirements.
According to FINMA’s investigation which began back in July 2018:
- Envion AG granted 30 years to the investors after which they can claim their repayments. This is a “bond-like” instrument which falls under Switzerland’s Banking Act and requires a banking license.
- The condition under which Envion AG issued tokens were not equal for all its investors
- Finally, the company didn’t bother setting up an internal audit unit, which is a requirement as per the country’s laws.
FINMA noted:
“The conditions for the EVN tokens issued in a bond-like form were not equal for all investors, the prospectuses did not meet the minimum statutory requirements and there was no internal audit unit as required by law. In the present case, this acceptance of US dollars and the Ethereum and Bitcoin cryptocurrencies, therefore, amounted to an acceptance of public deposits for the purposes of the Banking Act. This, however, requires a banking license.”
It is not known yet if the company will start refunding its investors as they are already in the liquidation process.
Author
Rajarshi Mitra
Independent Analyst
Rajarshi entered the blockchain space in 2016. He is a blockchain researcher who has worked for Blockgeeks and has done research work for several ICOs. He gets regularly invited to give talks on the blockchain technology and cryptocurrencies.
