- BarnBridge DAO, founders settle SEC charges for $1.7 million over unregistered SMART Yield bonds.
- The SEC alleged failure to register cryptocurrency securities and cited securities law violations.
- Gurbir Grewal emphasizes blockchain compliance while emphasizing universal application of securities laws.
Decentralized finance (DeFi) protocol BarnBridge DAO and its founders Tyler Ward and Troy Murray will pay more than $1.7 million to settle a lawsuit filed by the Securities and Exchange Commission (SEC).
The charges against BarnBridge relate to failing to register the offer and sale of structured crypto-asset securities known as SMART Yield bonds. The SEC alleged that DAO and its founders sold these bonds without proper registration, violating securities laws.
BarnBridge DAO’s $1.7 Million Settlement
BarnBridge DAO, a player in the evolving DeFi space, has agreed to a settlement with the SEC worth over $1.7 million. The settlement includes BarnBridge receiving nearly $1.5 million in proceeds from the sale of SMART Yield bonds and imposing separate civil penalties of $125,000 on both Ward and Murray.
The US SEC accused the DAO and its founders Tyler Ward and Troy Murray of failing to register “the offering and sale of structured crypto-asset securities known as SMART Yield bonds.” According to a statement from the SEC, SMART Yield generated revenue by collecting cryptocurrency from investors and paying them out.
The SEC’s investigation found that Ward and Murray promoted SMART Yield extensively through appearances on social media and YouTube channels related to decentralized finance, comparing SMART Yield to asset-backed securities. This approach attracted over $509 million in investment from a variety of investors.
With this settlement, the SEC strengthens its stance on the need for regulatory compliance within the blockchain and cryptocurrency space. The regulatory environment is evolving, and companies operating in this space must navigate it with a keen awareness of their regulatory obligations.