The Securities and Exchange Commission said yesterday that it reached a settlement with the founder of a digital-token trading platform for operating an unregistered exchange, the Wall Street Journal reported. The regulator reached a settlement with EtherDelta founder Zachary Coburn, who in 2016 launched the EtherDelta website as a platform for trading blockchain-based tokens— known as ERC20 tokens — the SEC said. ERC20 is a standard coding protocol often used in initial coin offerings. This is the first time the SEC has targeted a cryptocurrency exchange, and what is known in the crypto sector as a “decentralized” exchange. Essentially, EtherDelta was a piece of software that allowed users to trade with each other directly, as opposed to a centralized business like a traditional stock market that facilitates trading. Coburn, without admitting or denying the SEC’s accusations, will pay $300,000 in disgorgement, a $75,000 penalty and $13,000 in prejudgment interest, the SEC said. The regulator said it took Coburn’s cooperation into consideration when deciding on his penalty. Read more. (Subscription required.)
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