The Securities and Exchange Commission announced charges against Seattle-based operator of an online eSports gaming and gambling platform Unikrn Inc. for conducting an ICO of digital asset securities. The company has agreed to settle the charges with $6.1 million penalty, substantially all of the company’s assets, to be distributed to investors through a Fair Fund.
SEC’s order claims that from June to October 2017, Unikrn raised around $31 million through its offering of the UnikoinGold (UKG) token. The SEC found that Unikrn intended to use the proceeds to make more features for the gaming platform and to develop additional applications for the UKG tokens. The company promised investors that it would facilitate a secondary trading market for the tokens and that its efforts to boost the usages for the UKG token would also raise the demand and value of the tokens. The Commission found that Unikrn offered and sold UKG as investment contracts, which makes them securities, however failed to register the offering or qualify for an exemption.