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Since the cryptocurrencies have reached their historical highs, the SEC of the United States has been keeping an eye on the sector. This is due to the fact that the ICO boom that has occurred in this period has brought many new investors into the cryptocurrency space that needed protection from scam projects. Since then, the SEC has been actively involved in the field and has taken numerous measures to minimize the risks associated with cryptocurrencies and ICOs. Many projects that do not respect the rules established by the commission have been penalized.
Paragon gets pulled down by the SEC
In November 2018, the US SEC announced that Paragon was under control due to some possible dishonest business practices. This led to a desist and cease order. The SEC has declared that Paragon is in the same level as the offerings of securities. Therefore, not registering with the SEC was a violation of the commission law. The company had to opt for an agreement that included a commission of $ 250,000 and a monthly presentation of a report. Paragon was also sentenced to compensate investors who suffered losses. This included all investors who purchased the Paragon token before and on 15 October 2017.
Paragon proceeds with pumping and dumping even after regulatory control
On January 1, the entire community of cryptocurrencies was shocked by the significant rise in Paragon token prices. The token suddenly gained a 6000% increase in the price jump from $ 0.165866 to $ 10.28 in a short period. Trading volume over a 24-hour period was $ 3 million while market capitalization was $ 25 million.
On that day, the closing value of the currency was $ 0.389375 indicating more than 234% of the price compared to the opening price. At press time, it was trading around $ 0.214 and market capitalization was above $ 14 million. For a period of seven days, the Paragon coin has increased by 107.57.
During the pump and dump scheme, traders began to negotiate through arbitrage by buying and selling cryptocurrencies on various exchanges to get quick profits. Before the start of the pump, YoBit with the highest exchange rate announced that there would be a pump and discharge scheme. The first pump was on PutinCoin. It has increased more than 800% in just a few minutes. After a while, even the Paragon coin has increased.
With the SEC breathing Paragon's neck, one might think that the company will maintain a low profile for a while. The SEC has yet to make statements about what happened, but this pump and dump can not be good for a startup with an already fragile reputation. In the coming days, we will be able to determine if the pump and landfill scheme has attracted the SEC's attention.
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