- SALT Blockchain has been told to repay SALT token ICO investors by the SEC
- SALT raised almost $50 million from ICOs in 2017 and 2019
- The SEC has said that the sales were unregulated securities and investors must be refunded
SALT Blockchain, the company behind the cryptocurrency-backed loan platform SALT Lending, has been hit with a cease and desist order by the United States Securities and Exchange Commission (SEC) and will have to refund almost $50 million worth of ICO funds to contributors. The charge relates to two SALT Lending token sales carried out in 2017 and 2019 which the SEC say constituted sales of unregulated securities, and is accompanied by a $250,000 civil fine.
SALT’s Rocky History
SALT Lending raised $47 million in their June-December 2017, where SALT tokens were sold for anywhere between £2.50 and $10. The token value hit $17.22 in late December 2017, but this is where the good news ended. The value of the token collapsed with the rest of the market in 2018, which is when the SEC became interested, subpoenaing SALT Blockchain for ICO records in February that year as part of an investigation into the token sale.
The SALT Lending platform launched regardless, although it was rocked in July 2018 when CEO Shawn Owen abruptly left the company with no explanation. Fellow crypto loan platform Nexo offered to buy out the company’s loan claims, but this offer was rejected.
SALT Blockchain Must Repay Almost $50 Million
The SEC charges against SALT Blockchain were filed in November 2018, and nine months later SALT Lending, presumably strapped for cash at that point, held another ICO, where they raised a further $1.2 million. This decision has come back to bite them however, as the funds raised in this round must also be repaid.
As a final insult, the SALT token was delisted from Binance in February 2019, which CEO Bill Sinclair said caused “false negative implications” about the project. SALT Blockchain still operates SALT Lending, although how long the project will be able to continue once it has paid back almost $50 million remains to be seen.