- The SEC has charged 3 folks of insider buying and selling associated with Lengthy Blockchain’s 2017 rebranding.
- The Lengthy Island Iced Tea Co. modified its title to profit from Bitcoin hype, however the SEC alleges that it used to be a part of a rip-off.
America Securities and Trade Fee (SEC) continues to put down enforcement on Lengthy Blockchain Corp., which is, imagine it or no longer, a beverage-making corporate. As of late, the company introduced it has charged 3 folks with insider buying and selling in terms of the company’s famed rebranding.
In December 2017, as the cost of surged and the clicking used to be awash with hype over the opportunity of generation, the Lengthy Island Iced Tea Co. introduced that it had modified its title to Lengthy Blockchain Corp. Its inventory worth briefly rose by means of 500%, even if the corporate struggled when Bitcoin’s personal worth tanked in early 2018.
Confirming what many already suspected in regards to the transfer, the SEC alleges that the rebranding used to be a part of an insider buying and selling scheme. The SEC charged Eric Watson, an “undisclosed keep watch over particular person” at Lengthy Blockchain who masterminded the title alternate, in conjunction with his dealer Oliver Barret-Lindsay and Barret-Linday’s buddy Gannon Giguiere.
In step with the SEC, Watson allegedly shared early phrase and a draft press unlock of the rebranding announcement with Barret-Lindsay, who in flip handed the data onto Giguiere. The SEC alleges that Giguiere proceeded to buy 35,000 stocks of the corporate’s inventory, after which bought the ones stocks inside two hours of the announcement at a benefit of greater than $160,000.
The SEC is looking for everlasting injunctions and civil consequences for all 3 defendants, in addition to to bar Watson from being an officer and director. The company had in the past charged Barret-Lindsay and Giguiere over a separate inventory manipulation scheme, which remains to be being litigated. Lengthy Blockchain founder Philip Thomas, who used to be CEO when the rebranding took place in 2017, has no longer been charged by means of the SEC.
That is the SEC’s 2d enforcement towards Lengthy Blockchain to this point this 12 months. Again in February, the company revoked the corporate’s securities registration, delisting its stocks and fighting them from being traded. The corporate had no longer filed a quarterly document since September 2018, Bloomberg reported on the time.
“In December 2017, the corporate modified its title to LBCC and introduced that it used to be transferring its industry operations from cushy drink manufacturing to actions associated with blockchain generation,” the SEC wrote in February. “Its blockchain industry by no means turned into operational.”
Lengthy Blockchain turned into an emblem of the absurdity round Bitcoin’s meteoric early mainstream upward thrust, in conjunction with the Wild West nature of the burgeoning crypto trade on the time.
Then again, simply this 12 months, Chinese language iced tea corporate City Tea—which trades at the Nasdaq—introduced that it had pivoted into blockchain tech and cryptocurrency mining. City Tea’s inventory worth jumped on the announcement, and whilst historical past will have repeated itself on that entrance, with a bit of luck it doesn’t result in equivalent long-tail enforcement by means of regulators.