The U.S. Securities and Exchange Commission has filed a joint stipulation with blockchain tech firm Dragonchain to dismiss the lawsuit the agency filed against the firm. The filing, submitted Thursday, cited the launch of the agency’s Crypto Task Force in explaining the joint decision to drop the litigation. In August 2022, the SEC filed a complaint against Dragonchain and several affiliated entities over its 2017 initial coin offering (ICO), alleging that it involved unregistered offerings of “crypto asset securities.”
Under leadership of former chair Gary Gensler, the SEC filed enforcement actions against multiple crypto firms with charges of offering unregistered securities, under the pretense that most crypto assets were deemed to be investment securities. As Gensler departed the agency with pro-crypto Donald Trump’s reelection as President, the SEC shifted to a friendlier approach, dropping many of its enforcement actions on major crypto players, including Coinbase and Kraken.
The agency’s Crypto Task Force, created in January, said it would work to discern what cryptocurrencies should not be counted as securities and subsequently announced that most Memecoins do not fall under the SEC jurisdiction. “In light of the foregoing, and in the exercise of its discretion and as a policy matter, the Commission believes the dismissal of this case is appropriate,” the Thursday filing said. Likely influenced by the news, the price of Dragonchain (DRGN) rose 95.8% in the past 24 hours to trade at $0.07782, according to data from CoinMarketCap.
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