Swiss watchdog confirms illegal activity at $90 million Envion ICO

28 Mar, 2019
by Joeri Cant
Swiss watchdog confirms illegal activity at $90 million Envion ICO

The Swiss Financial Market Supervisory Authority in Switzerland have confirmed that the Zug-based cryptocurrency venture Envion, a crypto mining operation, unlawfully received deposits from at least 37,000 investors.

According to the statement by FINMA, Envion unlawfully received over $90.5 million in its Initial Coin Offering without having the necessary statutory licence.

Apparently more than 37,000 investors purchased the EVN tokens by making payments in US dollars, Ethereum and Bitcoin. Accepting these payments qualified as public deposits under the Banking Act, which requires a banking licence, according to FINMA.

'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 licence', FINMA said.

Besides a lack of a banking licence, the Swiss Financial Market Supervisory Authority has also found that EVN tokens were not issued under the same conditions to all investors.

'Envion AG granted the token owners a claim to repayment after thirty years', FINMA said.

'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.'

Envion AG, was already ordered into liquidation in late 2018 and is now entirely unfunctioning. FINMA therefor decided that it will not be taking any further action against Envion AG.

Read more: 'Crypto is still very much an early adopter market'

Previously Chepicap reported that Switzerland, considered to be an undisputed leader in the financial and offshore sectors, is taking steps to set up rules in their crypto markets.

The legislative powers of Switzerland asked to adapt the provisions on procedural instruments of the judicial and administrative authorities so that they can also be applied to cryptocurrencies.

The motion, which was presented by representative Giovanni Merlini from the FDP, mentioned in second place the need of “closing gaps in protection against abuse”, a measure needed due to the anonymity of crypto assets enabling for extortion and money laundering, according to the views of the politician from one of the best-known destinations for opaque fiat funds worldwide.

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