Seattle startup Unikrn will pay a $6.1 million fine and disable its UnikoinGold (UKG) cryptocurrency to settle Securities and Exchange Commission charges that the eSports betting company conducted an unregistered initial coin offering in violation of federal securities laws.
Unikrn, led by CEO Rahul Sood, a veteran entrepreneur who previously oversaw Microsoft’s venture capital arm, agreed to pay the penalty without admitting or denying the SEC charges.
The company, which has been backed by celebrity investors including Mark Cuban and Ashton Kutcher, raised $31 million in the initial coin offering three years ago. In charging the company, the SEC said Unikrn “failed to register the offering or qualify for an exemption.”
The $6.1 million settlement represents “substantially all of the company’s assets,” the SEC said in a news release.
In a statement on its website, Unikrn said the SEC established guidelines after the ICO which “applied retroactively, raised many questions with regards to the future of UKG.”
“Unikrn’s priority was in growing and innovating the Unikrn platform while trying to find common ground with the SEC that would allow us to promote the merits of UKG,” the company said. “Short of that, our other option was to reach settlement on UKG’s past and discontinue it moving forward so that our energies could be