A Dallas company agreed to settle SEC charges of operating an unregistered exchange and defrauding investors in unregistered digital assets offerings.

According to the SEC Complaint, Bitqyck, Inc. and its founders Bruce E. Bise and Samuel J. Mendez (collectively, "Bitqyck") raised more than $13 million from investors through mass-marketed securities offerings of digital tokens called "Bitqy" and "BitqyM." Bitqyck allegedly promised investors that, upon purchasing a Bitqy token, each would immediately receive one-tenth of one share of Bitqyck common stock through the operation of a smart contract. According to the Complaint, no smart contract was associated with the token and no common stock was ever transferred to a Bitqy investor.

Bitqyck is also alleged to have claimed it owned a cryptocurrency mining operation in Washington State that was able to purchase electricity at below-market rates. According to the SEC, Bitqyck owned no such operation. In addition, Bitqyck is alleged to have operated an online trading platform that was required to register with the SEC as a national securities exchange but failed to do so.

To settle the SEC charges, Bitqyck agreed to pay disgorgement, prejudgment interest and a civil penalty of $8,375,617. Mr. Bise and Mr. Mendez agreed to pay disgorgement, prejudgment interest, and civil penalties of $890,254 and $850,022, respectively.

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