Public Company Pivoted To Crypto Continues To Face Asset Freeze

According to a federal judge, The U.S. Securities and Exchange Commision (SEC) will probably win its case against three individuals associated with Longfin Corp, a company whose stock soar after a blockchain pivot.

U.S. Region Judge Denise Cote said on Tuesday that the administrative organization has a decent shot of demonstrating that Andy Altahawi, Suresh Tammineedi, and Dorababu Penumarthi unlawfully profit by the rotate. Longfin’s cost hopped by over 2,000% a year ago after it declared the obtaining of a blockchain startup.

U.S. Region judge Denise Cote stated on Tuesday that the administrative organization has a great chance of attesting that Andy Altahawi, Suresh Tammineedi and Dorababu Penumarthi “illegally benefited from the pivot,” Longfin’s price jumped by more than 2,000% last year after it made an announcement of the acquisition of a blockchain startup.

“The SEC has shown that it is likely to prove at trial that these defendants participated in an unregistered, illegal public offering of the stock of Longfin Corp.” she stated.

“As part of this decision, Cote granted a preliminary injunction to the SEC and also maintained a freeze on $27 million worth of assets owned by Altahawi, Tammineedi, and Penumarthi that the Commission sought in April.” Cited Coindesk.

Also, the SEC claim that Longfin gave more than 2 million unregistered restricted shares to Altahawi, and tens of thousands of restricted shares to Penumarthi and Tammineedi, from which the three people garnered the now frozen assets in question.

The organization’s CEO, Venkata Meenavalli, was likewise at first named as a respondent for the situation, yet Cote unfroze the advantages of both Meenavalli and Longfin on April 23 after the last exhibited that neither he nor the organization benefitted from the professedly illicit advertising.

Venkata Meenavalli, The CEO of the company, was initially called the defendant in the case, but Cote unfroze the assets of both Meenavalli and Longfin on April 23 after the latter demonstrated that neither he nor the company profited from the allegedly illegal offering.

January remarks by the SEC Chairman Jay Clayton foreshadowed the Longfin case. He commented at the time that the Commission is investigating “the disclosures of public companies that shift their business models to capitalize on the perceived promise of distributed ledger technology” to guarantee that they follow securities laws.