On 29 April, the U.S. Securities and Exchange Commission (SEC) issued a notice detailing the temporary suspension of an Oklahoma based small scale cryptocurrency mining and exchange, Bitcoin Generation barring it from securities trading.
According to the announcement, the exchange’s suspension would commence from 9:30 pm EDT on 29 April and would be in force until 11:59 pm EDT on 10 May.
The Reason Behind the Suspension
The reason mentioned in the notice behind the stay is the uncertainty surrounding the workings of the self-proclaimed exchange. According to the SEC, there is a lack of clarity when it comes to information available in the public domain about the exchange, its pending stock, publicity campaigns, its influence on the crypto community, and even its financial standing.
Also, under suspicion is Bitcoin Generation’s acquisition of a bond issued by the London Stock Exchange in March last year that was announced as a “small step in improving the financial situation of the company as we continue to build our mining operations” by the CEO of the exchange Deniz Hadjiev himself. The said bond was worth €20 million or $24.4 million when it was acquired and has now come under the lens of the SEC which is questioning its very authenticity and valuation.
The SEC has also issued a word of caution through the notice urging individual and institutional investors to refrain from indulging in any kind of business with the company without carefully going through all its details available in the market. The notice read:
“The commission cautions broker-dealers, shareholders, and prospective purchasers that they should carefully consider the foregoing information along with all other currently available information and any information subsequently issued by the company.”
Further, broker-dealers are specifically warned not to enter any kind of quotations with the company even after the suspension expires unless all of the SEC’s queries are properly answered and the exchange has fully complied with the regulatory body’s rules.