Riot Blockchain Subpoenaed By SEC Amidst Plans To Launch Exchange

In its 10-K filing, Riot Blockchain shared that the company was recently subpoenaed by the SEC. Despite a myriad of concerns, the Nasdaq-listed company claims to be pushing forward with plans to expand its bitcoin mining operation and to possibly launch a cryptocurrency exchange.On Tuesday, Riot Blockchain (formerly Bioptix) filed its annual report with the US Securities and Exchange Commission. As part of its submission, Riot shared that the company received a subpoena from the SEC approximately one week prior, on April 9, 2018. “The Company intends to fully cooperate with the SEC request,” wrote Riot. The news was first reported by the Denver Post, which has carefully followed the company ostensibly based in Castle Rock, Colorado.In recent months, the SEC has taken action against several newly-minted blockchain and cryptocurrency companies, including The Crypto Company and UBI Blockchain Internet, Ltd (which each utilized a reverse merger to become publicly traded). Two weeks ago, the SEC froze $27 million in stock sales of “purported cryptocurrency company” Longfin Corp. It’s worth noting that Riot Blockchain (like Longfin) is listed on the Nasdaq, which might be part of the reason for the SEC’s added scrutiny.Readers may remember that in October 2017, Riot abruptly pivoted from veterinary patents to blockchain technology and cryptocurrency endeavors, a shift that coincided with the bitcoin mania. In October alone, the price of bitcoin jumped by approximately $2,000 per coin.In its 10-K filing, Riot claimed that the company is “actively investigating the launch of an exchange that would provide secure and regulatory compliant access to services which exchange digital currencies like Bitcoin, Ethereum, Litecoin and Bitcoin Cash.” The company is also reportedly on track to deploy approximately 8,000 Bitmain S9 miners by the end of May 2018.There has been much discussion about the Riot’s insider stock sales and long-term viability, which is well-warranted. It’s important to take Riot’s filings and associated reports with a massive grain of salt, as CNBC found major red flags during a recorded news investigation in February (e.g., annual meetings scheduled at a resort, but the hotel having no evidence of any such reservations).To date, there are at least three (and possibly as many as five) class action lawsuits pending against Riot Blockchain. Given the widespread investor dismay, perhaps Riot is an appropriate name after all.Matthew is a writer with a passion for emerging technology. Prior to joining ETHNews, he interned for the U.S. Securities and Exchange Commission as well as the OECD. He graduated cum laude from Georgetown University where he studied international economics. In his spare time, Matthew loves playing basketball and listening to podcasts. He currently lives in Los Angeles. Matthew is a full-time staff writer for ETHNews.ETHNews is committed to its Editorial PolicyLike what you read? Follow us on Twitter @ETHNews_ to receive the latest Riot Blockchain, Bioptix or other Ethereum law and legislation news.

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