A seven-month lawsuit between the United States securities regulator and a company that allegedly manipulated the price of cryptocurrencies came to an end with a payment of $2.8 million.
On April 20, a New York District Court judge ruled against Hydrogen Technology Corporation and its former CEO Michael Ross Kane in a lawsuit filed by the Securities and Exchange Commission (SEC), ordering them to pay $2.8 million in damages and civil penalties.
The sum comprises approximately $1.5 million in "returned" proceeds, which refers to proceeds obtained from illegal conduct, as well as a fine of more than $1 million.
In addition, Hydrogen CEO Michael Kane has agreed to pay an individual penalty of approximately $260,000. The remaining amount is made up of pre-trial interest.
In September 2022, the SEC filed its complaint alleging that Kane used Hydrogen's market maker, Moonwalkers Trading Limited, to perpetrate a scheme that manipulated the volume and price of its ERC-20 Hydro (HYDRO) token.
The SEC claimed that Kane and Moonwalkers CEO Tyler Ostern worked "to create the false appearance of strong market activity" following Hydrogen's distribution of Hydro tokens through airdrops, bounty programs, and direct sales. to the market in 2018.
We are announcing charges against The Hydrogen Technology Corporation, its former CEO, Michael Ross Kane, and Moonwalkers Trading Limited CEO, Tyler Ostern, for unregistered offerings, sales, and manipulation of crypto asset securities called "Hydro."
โ US Securities and Exchange Commission (@SECGov) September 30, 2022
According to the SEC complaint, Ostern sold the chips in an "artificially inflated market" that saw Hydrogen make more than $2 million in profit.
One day after the complaint was filed, Ostern agreed to settle the case for $41,000.
Related: The SEC's 'brute force' attempt at crypto regulation is 'bad policy' - Paradigm
Both Hydrogen and Kane are now bound by the terms of the agreement, which prevents them from further contesting the charges that the SEC has imposed on them.
Kane and the firm will be prohibited from selling any additional cryptocurrency until the Hydro tokens have been passed Howey's test and received further approval from the SEC.
Kane is still allowed to participate in the broader cryptocurrency market, which means he can still buy and sell crypto assets for personal gain.
Hall of Flame: Crypto Wendy on trashing the SEC, sexism, and how underdogs can win
Post navigation
