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Tuesday, September 21, 2021
Home News Swiss Regulators say $90 million Envion ICO was Illegal - Liquidate and...

Swiss Regulators say $90 million Envion ICO was Illegal – Liquidate and Return

The Swiss Financial Market Supervisory Authority (FINMA) has released news on their site that crypto mining firm Envion AG’s ICO was illegal and violated a number of Swiss laws. Evion’s ICO raised $90 million from some 37,000 investors but failed to follow the rules as laid out by regulators. 

According to FINMA’s investigation which began back in July 2018:

“Investigations carried out by FINMA to date indicate that in the context of its ICO, Envion AG accepted funds amounting to approximately one hundred million francs from more than 30,000 investors in return for issuing EVN tokens in a bond-like form.”

“FINMA is committed to ensuring that serious innovators can launch their ICO projects lawfully and published guidelines to this effect in February 2018. However, it also consistently takes action against ICO business models, which violate or circumvent supervisory law. FINMA has also repeatedly drawn attention to the risks that ICOs pose for investors.”

The news was announced a couple of days ago.

“Envion AG granted the token owners a claim to repayment after thirty years. Furthermore, the conditions for the EVN tokens issued in a bond-like form were not equal for all investors, the prospectuses did not meet the minimum statutory requirements and there was no internal audit unit as required by law. In the present case, this acceptance of US dollars and the Ethereum and Bitcoin cryptocurrencies, therefore, amounted to an acceptance of public deposits for the purposes of the Banking Act. This, however, requires a banking license.”

Nicholas Ruggieri from EthNews also dug up some interesting tidbits in an investigative piece here:

“Drama surrounding the EVN token was behind much of the infighting between founders Luckow and Woestmann. In January 2018, Woestmann allegedly issued actual shares of the company to investor Thomas van Aubel (a German lawyer) instead of tokens, diluting Luckow’s 81 percent stake to 33 percent, in what Luckow called the “world’s first analogue ICO hacking.”

“In May 2018, Woestmann claimed Luckow and a group of founding members fraudulently created 20 million additional tokens to enrich themselves without the knowledge of the board of directors. As a result, Woestmann planned to take full control of the company, which might have actually panned out if it wasn’t for a Swiss court that found Envion didn’t really have a board of directors, to begin with.”

It is not known yet if the company will start refunding its investors as they are already in the liquidation process.

Richard Kasteleinhttps://www.the-blockchain.com
In his 20s, he sailed around the world on small yachts and wrote a series of travel articles called, 'The Hitchhiker's Guide to the Seas' travelling by hitching rides on yachts (1989) in major travel and yachting publications. He currently lives in Groningen, the Netherlands where he has set down his anchor to raise a family and write. Founder and publisher of industry publication Blockchain News (EST 2015) and director of education company Blockchain Partners (Oracle Partner) – Vancouver native Richard Kastelein is an award-winning publisher, innovation executive and entrepreneur. He has written over 2500 articles on Blockchain technology and startups at Blockchain News and has also published in Harvard Business Review, Venturebeat, Wired, The Guardian and a number of other publications. Kastelein has an Honorary Ph.D. and is Chair Professor of Blockchain at China's first blockchain University in Nanchang at the Jiangxi Ahead Institute software and Technology. He has over a half a decade experience judging and rewarding some 1000+ innovation projects as an EU expert for the European Commission's SME Instrument programme as a startup assessor and as a startup judge for the UK government's Innovate UK division. Kastelein has spoken (keynotes & panels) on Blockchain technology at over 50 events in 30+ cities.
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