Two people requested that the SEC’s lawsuit against them be dropped on the grounds that the agency does not have jurisdiction over cryptocurrencies. They were accused of fraudulent crypto mining schemes.
Two people who had been charged by US securities regulators with committing $18 million worth of cryptocurrency mining scams requested that the case be dropped on the grounds that the agency had no jurisdiction over cryptocurrencies.
Wright Thurston and Kristoffer Krohn each filed requests to dismiss the Securities and Exchange Commission’s lawsuit on May 19.
The SEC filed a lawsuit against the two in March, along with claimed cryptocurrency mining and development firm Green United LLC, accusing them of fraudulent marketing of securities by selling “Green Boxes” and “Green Nodes” promoted as miners for GREEN tokens on the “Green Blockchain.” .
Thurston started the business, and Krohn contractually promoted it.
Thurston and Krohn argued for the cancellation of the act by stating that the SEC had no jurisdiction over the digital asset ecosystem and that Congress “considered and rejected” the SEC’s authority over cryptocurrencies.
They cited recent claims that the SEC practices “regulation with enforcement,” saying the regulator is “vague and inconsistent” in defining cryptocurrencies.
The SEC has decided to try to litigate towards a coherent regulatory structure instead of trying to propose legislation or create rules.
They also argued that the SEC had not proved that the Green Boxes were securities offerings or “investment contracts,” as the regulator had done in its March complaint.
The SEC confirmed in a March lawsuit that the hardware sold by Green United was in fact a Bitcoin ticker BTC down $27,239 mining equipment that failed to mine GREEN as stated and that the alleged blockchain was fake.
According to regulators, the alleged scam generated an estimated $18 million, and investors “did not receive” any BTC mined by Green United.
Gary Gensler, chairman of the SEC, has long argued that the Commission has jurisdiction over cryptocurrencies and that, apart from Bitcoin, most cryptocurrencies are under the Howey test for securities.
The Defendants’ post in the $18M fraud complaint argued that the SEC has no jurisdiction over cryptocurrencies. first appeared on BTC Wires.