AriseBank stands up to fight the SEC crackdown on the ICO market

Following the SEC report on Munchee Inc where the startup’s Initial Token Offering campaign was shut down within 48 hours of its start, the US authorities have entered the so-called witch-hunting mode on the Blockchain crowdfunding market. However, if Munchee Inc has immediately cooperated with the cyber-security division of the SEC, the Texas-based firm AriseBank have decided to take a stand and go through the legal fight with the Security and Exchange Commission of the United States of America.

The timeline

Oct 4, 2017 – Two month before the start of their campaign, AriseBank publishes a Facebook post where it declares its dedication to fight with the SEC.
Jan, 2018 – token sale for the decentralized banking platform takes place aiming to end on Jan 27, 2018. During their, ICO AriseBank raises $600,000,000 worth of crypto assets with the hard cap set at $1,000,000,000.
Jan 5, 2018 – Texas Department of Banking issues a cease-and-desist order
Jan 18, 2018 – AriseBank publishes the press release claiming that they have acquired a (supposedly) FDIC insured KFMC Bank Holding Company and TPGB. The further investigation has revealed the statement to be false.
Jan 25, 2018 – the SEC files the complaint against the AriseBank starting the legislation process. The fight is on.

Current situation

The SEC currently charges the founders with fraud and issuing unregistered securities. In February the AriseBank HQ is visited by the SEC and FBI. Mark Rasmussen (from the global law firm Jones Day) is appointed by the US District Court in Dallas as a third-party, independent receiver of AriseBank’s seized assets. While Stanley Ford (currently in Dubai) refused to collaborate, Jared Rice helped identify the company capital of 27.96 bitcoins, 196,131.04 dogecoins, 271.33 litecoins, 2,391,455.51 bitshare coins, 19,413.76 PIVX and 3599.99 BitUSD coins. Mr. Ramussen in his report claims that far more assets are yet to be claimed.

Curiously enough: Mark Rasmussen does not intend to liquidate the cryptocurrencies right now and plans to propose the specific cryptocurrency liquidation plan.

A new report from Mr. Rasmussen is expected to be published in April 2018.

Community response

Researching the community response on the popular blogging platform Steemit, it seems like the opinions are divided with plenty of people being stuck on the fence trying to pick the right side to support. It’s clear that the AriseBank had plenty of red flags raised. Yet, the SEC is known for its conservative approach towards the ICO market with the SEC Chairman Jay Clayton considering most of the ICO campaigns to offer unregistered securities.

Further investigation is underway with the audience curious about the outcomes of one of the biggest legal fights on the ICO in 2018. One thing is crystal clear, the SEC’s definitive regulation and framework for registering utility and security tokens are much needed to avoid any further confusion and FUD in the emerging industry of decentralized-ledger technology.

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