The fallout from the meteoric rise of cryptocurrencies continued on Monday, when two Nevada men agreed to settle a lawsuit filed by the U.S. Securities and Exchange Commission (SEC) accusing them of illegal sale in company stocks. In its lawsuit, filed in a New York federal court, the SEC accused Nevada lawyer T.J. Jesky and his law firm's business affairs manager, Mark DeStefano, of illegally selling shares in UBI Blockchain Internet Ltd. from December 26, 2017 to January 5, 2018. The two, according to the regulator, made over $14 million in profits over the two-month period. Hong Kong-based UBI Blockchain Internet, formerly known as JA Energy, primarily deals with research and application of blockchain technology, focusing on the Internet of Things. The company has a market capitalization of around $358 million, according to latest figures quoted by Bloomberg. In October, Jesky and DeStefano allegedly got their hands on 72,000 restricted shares of the company. The SEC said the two were allowed to sell the shares at the fixed price of $3.70, but they took advantage of the huge rally in the company’s price and sold the shares at overvalued prices ranging from $21.12 to $48.40. Eventually, the SEC recorded what it deemed as "unusual and unexplained market activity" involving the company’s shares in January, resulting in the suspension of its trading on January 22. In response to the lawsuit, Jesky and DeStefano agreed to reimburse an estimated $1.14 million of the alleged ill-gotten gains as well as pay $188,682 in penalties. The two, however, did not admit or deny SEC's allegations. "This case is a prime example of why the SEC has warned retail investors to be cautious before buying stock in companies that suddenly claim to have a blockchain business,” Robert A. Cohen, chief of the SEC Enforcement Division’s Cyber Unit, said in a statement. “This case involved both a trading suspension and people holding restricted shares who attempted to profit from the dramatic price increase with illegal stock sales that violated the registration statement.” The SEC has long been showing its concerns on fraud in the crypto space. In May, the regulator launched a fake initial coin offering (ICO) website in a bid to increase awareness of the typical warning signs of scam ICOs and to promote investor education. SEC Chairman Jay Clayton emphasized that the agency supports the adoption of new technologies, but added that it also encourages investors to educate themselves and understand what fraudulent offers look like.