Tuesday, June 3, 2014

SEC Charges Bitcoin Entrepreneur Erik Voorhees

 The Securities and Exchange Commission said Tuesday it charged Erik Voorhees with offering shares in two bitcoin-related websites without registering them, as required by federal securities laws. Voorhees allegedly published prospectuses and asked investors to buy shares in the two websites, SatoshiDICE and FeedZeBirds. Investors bought shares using the virtual currency bitcoin, leading to profits of more than $15,000 for Voorhees, according to the SEC. Voorhees agreed to settle the charges by giving up the profits of $15,843.98 and paying a penalty of $35,000. "All issuers selling securities to the public must comply with the registration provisions of the securities laws, including issuers who seek to raise funds using Bitcoin," said Andrew J. Ceresney, director of the SEC's Division of Enforcement.

This is low level harassment by the government of those operating in the Bitcoin world. Voorhees should be allowed to sell any investment he wants without having to file with the federal government, as should anyone else.

I continue to expect more serious charges, in the not too distant, from the government with regard to some operating in the Bitcoin world. Arrests will be made of some high profile names.

-RW

4 comments:

  1. Notice how no one argues with you that arrests will be made. We all agree. You just posted two days ago about arrests still ongoing for file sharing, yet everyday more files are shared. More copyright laws are broken and the authorities still lack the power to stop it. This is exactly what will happen with Bitcoin and they won't be able to stop it. Thanks for all the stupid updates though.

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    1. Bitcoiner tears are delicious.

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    2. Yeah. I agree. RW seems to celebrate with glee every time the state locks someone up for using an "unapproved" currency. He seems to care much more about "being proved right" about Bitcoin than about the government committing acts of aggression against people who have dared defy their monetary monopoly.

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  2. The settlement against Vorhees is a tiny drop in the bucket compared to what he sold SatoshiDice for. He made about $11 million worth of bitcoin, and that's when the dollar price of bitcoin was much lower. He's probably worth $50+M now. I'm sure he's happy to get rid of the hassle for such a small fee.

    I should add that this case has essentially nothing to do with Bitcoin. It's related to the issuing of shares that Vorhees did without SEC permission so it's strange to see Mr Wenzel using this as evidence of the likelihood of more prosecutions in the bitcoin world. If a gold company had issued shares without the SECs permission the same thing would have happened. To emphasize this is not related to bitcoin

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