American CryptoFed DAO, LLC’s forthcoming administrative hearing, as demanded by the Securities and Exchange Commission (SEC), is scheduled to take place on January 18, 2023. The Hearing Day 4 is labeled as public on the SEC’s event page. It was previously reported that hearings were scheduled to commence on December 1, 2022.
American CryptoFed, set up in Wyoming – a state that created laws specifically for the digital asset sector, aimed to challenge the SEC’s handling of digital assets stating its goal of issuing two digital assets, the Ducat and Locke, pursuant to the token definition in Token Safe Harbor Proposal 2.0 as suggested by SEC Commissioner Hester Peirce.
The Ducat sought to become an algorithmic stablecoin for routine transactions that targeted “zero inflation and zero deflation,” designed to “appreciate against USD by the amount of inflation USD experiences.” Locke was designed to be its governance token.
In a press release from last year announcing its move to become a public company, it incorporated a quote by SEC Chair Gary Gensler from when he taught at MIT:
“I am not aware of any statute, federal or state, that says there’s an absolute monopoly on form of money……it is legal to create your own form of money. But you have to comply with all the other laws….” Chairman Gensler also said in Section 19: Primary Markets, ICOs & Venture Capital, Part 1, “… I think there might be a reason why folks want to have native currency, a native token to jumpstart a network and to motivate a network overtime….”.
Initially, the SEC’s Enforcement Division claimed that a Form S-1 registration statement filed by American CryptoFed in September of 2021 failed to contain required information, such as audited financial statements. At the same time, the SEC alleged that it contained materially misleading statements and omissions, including inconsistent statements about whether the tokens were securities.
The SEC also said that American CryptoFed failed to cooperate during its examination of its registration statement.
The Administrative Hearing memo (most recent) is viewable here, outlining the series of events leading up to the next hearing (according to the SEC).
The Order states that:
“On August 8, 2022, the American CryptoFed president responded to the Commission staff’s August 4, 2022 letter. In that response, the American CryptoFed president failed to provide the requested information and instead asserted that “The Subpoenas pursuant to the 8(e) Order Are Unlawful” and “The Order Denying American CryptoFed’s Form S-1 Withdrawal Is Unlawful.”
Former American CryptoFed CEO referenced this article last year as 0utlining their position. The article said that American CryptoFed was “calling the SEC’s bluff on crypto.”
Appreciate @KDonW and @capitalcom for following and reporting the latest news regarding our SEC filing and communication with them regarding our tokens Ducat and Locke. All communication and docs are here: https://t.co/SOQnpkRKT2https://t.co/D9eCwP6yq2
— Marian Smith (@gofishwyo) November 9, 2021
The American CryptoFed website does not appear to have any recent updates, and its social media channels seem dormant at this time.
