The Securities and Exchange Commission (SEC) has another crypto project in its crosshairs, and yet again an allegedly fraudulent ICO is part of the rationale. The latest project to have drawn regulators’ ire is ICO package provider ICOBox, who dub themselves “the world’s most experienced ICO/STO service provider”. Founder and former CEO Nikolay Evdokimov is suspected by the SEC of conducting an illegal $14.6 million ICO in 2017 as well as failing to register as a broker, which history has told us are not things the SEC likes to see.
Tokens “Virtually Worthless”
The SEC’s complaint is that ICOBox told the more than 2,000 investors that the tokens they were buying would increase in value when the token hit exchanges, and that token holders would be able to swap them for other tokens promoted on the ICOBox platform at a discount. This turned out to be completely untrue, as the tokens are now, according to the SEC, “virtually worthless”. The complaint further alleges that ICOBox acted as a broker by facilitating ICOs that raised more than $650 million for dozens of clients, but failed to register as one.
ICOBox’s Rocky Road
ICOBox has endured something of a troubled history prior to this investigation. CEO Alex Moskovski left the project less than a year after the ICO to “pursue his own projects” with his replacement, Andriy Zinchuk, quitting just weeks later to “develop his own projects.” It was also revealed during this period that founder Evdokimov had been playing little or no role within the company since 2017, making his departure official in November last year so he could “direct his efforts on his own projects.” Sounds familiar. However, Evdokimov returned to the company just a month later as CEO, with Daria Generalova, co-founder and Managing Partner, announcing at the same time that she was leaving to…wait for it…“pursue her own projects.” Her role was taken by another co-founder Anar Babaev, who himself quit just five weeks later in order to “get a good rest after the exciting but wild last year in the crypto market and to switch my attention to my own projects.” With all that going on it’s a wonder they had time to run a fraudulent ICO and illegal broker token sales.