SEC Charges Bitcoin Entrepreneur For Share Offering

[dustcoin]

    Voorhees agreed to settle the SEC’s charges by paying full
    disgorgement of the $15,843.98 in profits plus a $35,000
    penalty for a total of more than $50,000.

Voorhees later sold S.DICE for 126k BTC ($12.4M at the time). Sounds like a good deal.

[citricsquid]

He did not own the majority of S.DICE and he lost 550 BTC (>10% of his holdings) when MtGox fell apart, he's certainly well off but he is far from 8 figure rich.

http://www.reddit.com/r/Bitcoin/comments/1yx2t5/erik_voorhee...

http://www.reddit.com/r/Bitcoin/comments/1yv6ph/some_words_f...

[rayiner]

It's interesting, but not surprising. If you offer to sell securities to the U.S. public, and meet certain other requirements, you need to register with the SEC. It doesn't matter if you take payment for the stock in dollars or Bitcoin or cupcakes.

[mabbo]

That's it. I'm selling securities via cupcakes.

Cupcakes represent a stable, decentralized currency with a proof-of-work (you had to bake a cupcake to get one!). No government can stop my cupcake transactions.

This is the future.

[driverdan]

There is a lot of fraud going on in the cryptocoin "IPO" space. It's strange that the SEC went after one of the cases that wasn't fraud. Maybe it was because they knew who he was. Either way they really need to crack down on these unregistered securities. People are being fleeced left and right.

[gojomo]

I suspect more people are losing money on state lotteries than cryptocoin IPOs. Shouldn't enforcers go after those, first?

[tinkerrr]

Wonder what the implications are for the other companies/altcoins that go the IPO route. There are a number of well-known companies in the space that IPO without registering with the SEC, most recently MaidSafe [1] from the SAFE network that got a lot of publicity but no questions asked about the IPO (except boasting in their press release that they raised $5 million in the first 5 hours [2]) [1]: http://www.businessinsider.com/these-guys-are-creating-a-new... [2]: http://www.ibtimes.co.uk/cryptocurrency-news-round-dogecoin-...

[DennisP]

I'm not convinced a presale of a currency falls under the same regulations as equity in a company.

[bitJericho]

They are registered in Scotland. Likely any American individual or company that doesn't register is liable to have the same thing happen to them.

[jedunnigan]

This was bound to happen eventually, especially given the indication of insider trading the day before SD was bought out.[0]

[0]http://sinistercyb.org/wp/2013/07/satoshi-dice-sale/

[tatalegma]

Very interesting that the shares he issued were purchased in bitcoin, and still the SEC decided to step in. How is this different than if you issue shares and sell them for an in game currency?

[_delirium]

The SEC doesn't really care how the payment is carried out, if that's the only difference. The actual medium of exchange could be dollar bills, gold coins, euros, baseball cards, rare watches, gemstones, bitcoin, used books, etc. (Though some of those are treated differently for capital-gains purposes.)