Envion AG is that one crypto firm that refuses to go away. Even after a court in the crypto valley of Zug ordered it to shut down, it somehow keeps on making headlines, for the wrong reasons once again. This time, the Swiss financial markets regulator has determined that its $90 million initial coin offering (ICO) was illegal.
According to a press release by Swiss Financial Market Supervisory Authority (FINMA), Envion wasn’t legally allowed to receive the funds it raised in its ICO. FINMA further stated that its investigations had only implicated the startup further. Part of the statement read:
“It was discovered during this that the company had unlawfully accepted funds amounting to over 90 million francs from at least 37,000 investors in the context of an initial coin offering (ICO) without the necessary statutory license. The company was thus acting illegally and seriously violated supervisory law.”
Despite being one of the biggest and most expensive failures in crypto, Envion had shown great promise when it was founded. The firm’s team had loads of experience and the product they built was as solid as they come. The startup promised its investors a seamless cloud mining experience which would leverage clean and renewable energy such as solar and hydroelectric power. The investors could purchase shares in the startup by buying the EVN tokens.
37,000 investors were impressed enough to invest, raising $90 million in total. For them, the nightmare began shortly after, with the founders sparking off a civil war that eventually led to the closure and liquidation of the promising startup.
According to FINMA, Envion violated the Banking Act by receiving U.S dollars and other cryptos without the necessary license.
“In the present case, this acceptance of US dollars and the Ethereum and Bitcoin Core [BTC] cryptocurrencies therefore amounted to an acceptance of public deposits for the purposes of the Banking Act. This however requires a banking license,” the statement stated.
FINMA will not take further disciplinary actions against the company. This is because the Cantonal Court of Zug has already opened bankruptcy proceedings against it.
And yet, despite losing its investors millions of dollars, the founders are still shifting blame. Speaking to CCN, the CEO Matthias Woestmann said that the team wasn’t at fault:
“Even if rules were violated, it was not the result of personal wrongdoing. Management cooperated with authorities to avoid further damage. All together this is the reason why there are no sanctions against the individuals and the case ends here.”
New to blockchain? Check out CoinGeek’s Blockchain for Beginners section, the ultimate resource guide to learn more about blockchain technology.