The Securities and Exchange Commission (SEC) has thrown out another lawsuit targeting a digital asset firm. According to a release, Dragonchain and founder John Joseph Roets are now off the hook from civil litigation.
In 2022, the SEC charged Dragonchain with raising $16.5 million in an “unregistered crypto asset securities offering.”
At that time, the SEC claimed that around $14 million was raised from an initial coin offering (ICO) from approximately 5,000 investors, including individuals in the US. Between 2019 and 2022, apparently, another $2.5 million in Dragon Tokens were sold.
In response to the SEC’s allegations, Roets publicly posted a letter explaining that they had sought clarity from the SEC. His legal counsel was under the impression that their cooperation meant the Commission would not take legal action. He said that in the final hours of the statute of limitations, the SEC filed charges against him and his firm.
During Gensler’s term leading the Commission, the SEC pursued regulation by enforcement, avoiding the reality of a fast-emerging digital asset ecosystem. The agency was criticized for telling innovators to come in and speak with them and then pursuing legal action to harm digital asset innovators.
The Commission has issued a statement indicating it is exercising its discretion and dismissing the pending enforcement action. The statement adds that the dismissal will facilitate the Commission’s ongoing efforts to reform and renew its regulatory approach to the crypto industry.
The case was dismissed with prejudice, indicating it will not be revived.