Unikrn, an initial coin offering from 2017, faces action from the United States Securities and Exchange Commission.
The SEC has accused the startup of running its ICO without going through the proper legal channels, based on a statement Tuesday from the regulating body. The commission claims Unikrn offered an unregistered investment opportunity.
“Unikrn agreed to settle the charges by paying a $6.1 million penalty, substantially all of the company’s assets, to be distributed to investors through a Fair Fund,” the statement said. “Unikrn also agreed to disable the UKG, publish notice of the order, and request removal of UKG from all digital asset trading platforms.”
The Unikrn project, with its UnikoinGold (UKG) token, jumped on the ICO bandwagon in September 2017, tallying about $28.6 million in invested capital, based on data from ICObench. The SEC statement, however, alleges the project raised a slightly higher amount — roughly $31 million — running from June to October.
The project positioned itself as a betting venue for the esports world. Essentially, the SEC has alleged the project framed its sale in a way that made it appear as a profit opportunity for investors, thus putting it in a financial category that required licensing, which it did not have. “The SEC’s order finds that Unikrn violated the registration provisions of the federal securities laws,” the statement said.
UKG sits at a press-time price of $0.01, down from its high near $1.82 at the peak of the last crypto bubble in January 2018, according to CoinMarketCap price data.
Unikrn made headlines back in 2017 when Dallas Mavericks owner Mark Cuban invested in the project.
UPDATE Sept. 15, 18:58 UTC: This article has been updated.