Bitcoin Generation (BTGN) Fires a Response Back at the SEC, Says They Are Highly Prejudicial
Bitcoin Generation’s CEO, Deniz Hadjiev, had some harsh words to say about SEC (the governmental agency in charge of regulating security trading).
He said that it didn’t even try to find out any facts with them before freezing the trading on the company’s stock. In his own words,
“We welcome regulators involvement into the crypto industry, but what we don’t accept is a unilateral decision to suspend our stock without even a request for information and this is not only reckless but causes extreme prejudice to the company, its shareholders and stakeholders.”
He called SEC’s move “highly prejudicial” in a press release. The release also says that
“It is the Company’s and Management’s intention and commitment to fully comply with the SEC’s request and the requests of any other regulatory agencies. The company will provide the information requested to the SEC and will subsequently request to restore the trading of the Company’s stock on the OTC Markets.”
SEC’s Alleged Reasons
SEC is worried about some specific marketing moves by Bitcoin Generation. Also by a particular bond valuation by a company in the UK. But it failed (or skipped) issuing any kind of announcement to Bitcoin Generation before freezing its stock in the market, which led to Mr. Hadjiev’s comment.
Despite the unpromising situation, Bitcoin Generation is assuaging its investors by letting them now that everything will be fine. The temporary freeze could be rolled back if the SEC receives, analyses and reviews the information it wants in a timely fashion. But if the required information is not provided, then the ban on Bitcoin Generation’s stock would remain frozen. And then, SEC could even take other actions.
This is a serious incident because of the allegations that SEC didn’t try to contact the company in question in any way. If that were the case, it would be a unilateral imposition on the free market by the government. So the whole episode could make market players put SEC’s behavior in question. Is that how the agency should be expected to do its job?
By forcing a freeze without even trying to clear things out with the stock issuers? Chances are that SEC wouldn’t do that against a more prominent player, even if a high degree of weirdness is on plain view in a large proportion. Just think of Tesla. This could be because moving against a more significant stock could create a market panic for which SEC wouldn’t want to be held responsible.
Nothing in the previous paragraphs should be construed as a denial that Bitcoin Generation’s status itself raises questions, which have been in the news already.
There is not enough information in the pool as we write this article. It’s impossible to say if SEC’s move was indeed an imposition or if Bitcoin Generation’s alleged irregularities merit the step. But in a supposedly market, the lack of information and transparency on both sides is problematic in itself.
We’ll have to wait and see to find out how things turn out for SEC’s reputation and Bitcoin Generation’s market performance.