- Riot Blockchain gets a subpoena from the US SEC.
- US SEC requested some certain information from the firm.
United States: The United States Securities and Exchange Commission (SEC) has sent a subpoena to Riot Blockchain, a Nasdaq-listed firm that became the focus of the media last year after it turned to offering cryptocurrency-related services. The news was released on 17th April in the Riot Blockchain’s annual report. In its filing, Riot Blockchain said that the SEC is “requesting certain information from the Company.” It states:
“As part of its review of the Company’s public filings, the Securities and Exchange Commission…has inquired about certain of the Company’s assets’ classification as, and amount of, possible Investment Company assets,” explained elsewhere in its filing, adding: “The Company intends to fully cooperate with the SEC request.”
It is not surprising that Riot Blockchain would be probed by the SEC since the agency has earlier stated last Jan. that it would scrutinize firms that have turned toward blockchain in recent months as a result of a wave of interest from investors.
Jay Clayton, the chairman of SEC said:
“The SEC is looking closely at the disclosures of public companies that shift their business models to capitalize on the perceived promise of distributed ledger technology and whether the disclosures comply with the securities laws, particularly in the case of an offering.”
The firm’s stock price rose greatly after pivoting into Blockchain, surpassing $40/share at a point. However, according to data from Google, the firm’s stock sells for $7.30 as of Tuesday 17th April. Riot Blockchain has also been hit with a number of lawsuits from investors during the wake of that stock price peak.
The firm received the subpoena barely a week after it made the announcement of its possession of a futures brokerage firm on 31st March, announcing its plans to commence a cryptocurrency and futures exchange in the U.S.
Also in the report, the firm gave new details about its possible delisting from the Nasdaq, a possibility the firm first revealed back in January as a result of its failure to hold its annual meeting.
Riot Blockchain stated:
“In order to maintain our NASDAQ listing, we must satisfy the requirements of a plan of compliance that we submitted to, and was accepted by, NASDAQ. That plan contemplates, among other things, holding our 2017 annual meeting of shareholders no later than May 15, 2018.”