SEC Still Plans on Charging Miami Crypto Company—But It’s Vowing to Fight Back

Crypto investment firm Unicoin is gearing up for a courtroom clash with Wall Street’s top cop, as the Securities and Exchange Commission has signaled plans to press ahead with its pursuit of the Miami-based company, According to co-founder Alex Konanykhin, the SEC’s Division of Enforcement gave Unicoin until April 18 to enter into settlement talks over allegations that the company knowingly violated both registration and antifraud provisions of federal securities law. That deadline has now passed, and Konanykhin says he has no intention of settling, vowing instead to fight the claims in court.“I fully intend to win this case in the courtroom,” he told Konanykhin, who says the company has been An SEC spokesperson declined to comment.Unlike other crypto firms, Unicoin’s token—which underpins the Unicoin ecosystem that includes a media company as well as talent and software services firms—is not currently tradable in the U.S. Instead, it’s marketed as a future-value, or promissory, token that grants investors access to future value backed by the company’s portfolio. The company itself aimed to raise awareness about its business model through an advertising blitz in New York City that included ads on yellow cabs, billboards, and even wrapped city buses. In doing so, it drew the attention of the SEC—which, according to Konanykhin, sparked the investigation.The SEC’s pursuit of Unicoin comes as the agency, under new Republican leadership, has rescinded several enforcement actions brought by former SEC Chairman Gary Gensler against high-profile crypto companies—such as Coinbase, Ripple, Kraken, and Consensys—over alleged unregistered securities violations. The new crypto-friendly Trump administration has pledged to end the Biden Administration’s so-called war on crypto and has directed Congress to craft legislation that creates compliance standards for crypto companies and investors.Unicoin, however, is facing a broader and potentially more serious set of accusations including violating antifraud provisions of the Securities Act and Exchange Act. SEC leadership under Acting Chair Mark Uyeda has in recent According to a Wells notice sent in December, the agency claims Unicoin gave away the firm’s native token, UNIC, through airdrops without first verifying the recipients’ accredited investor status. The agency also says Konanykhin improperly resold restricted securities without meeting exemption requirements.Specifically, Konanykhin identified an assistant director in the enforcement division, Brad Ney, a 10-year employee of the SEC, who has been leading the agency’s investigation into Unicoin.“I don’t think this reflects the views of the new SEC leadership,” he said. “This is being driven by rogue officials left over from the Gensler administration who are trying to cover themselves by bullying us into a false admission of guilt.”The interview with Decrypt was the first time Konanykhin has spoken out since the firm decided to forego settlement talks with the enforcement division.Unicoin recently requested a face-to-face with the Crypto Task Force, which has held meetings with more than sixty crypto firms since February, but has yet to hear back.Editor’s note: This story was updated after publication to include additional information about Unicoin.