DAO begins a litigation battle with the SEC over 2021 token registrations and opts not to have attorneys in its fight for registration.
In a legal battle with the Securities and Exchange Commission (SEC), the first decentralized autonomous organization (DAO) in the United States is registering tokens for the year 2021.
In response to SEC charges that it misrepresented and omitted facts in a securities registration last year, American CryptoFed DAO notified stated that it would represent itself without an attorney.
The SEC received a 2021 filing from the DAO registering its native, interdependent tokens, the stablecoin Ducat and governance token Locke. However, the regulator has started the process of issuing a stop order due to a number of issues with the registration.
Xiaomeng Zhou, the chief operational officer and coordinator of American CryptoFed, declared that the DAO will represent itself in court against the SEC:
“We just filed the Notice of Appearance according to the SEC’s rules. This letter means that we told the SEC that we will represent ourselves without attorneys in this case.u201D”
A motion to extend the time for submitting an answer to the SEC’s Order Instituting Administrative Proceedings will also be filed, according to American CryptoFed. It will then have 20 days to develop its defense against the SEC’s attempt to block American CryptoFed’s registration.
The interdependent Locke and Ducat tok, which serve as tools for the DAO’s proposed Wyoming-based monetary system, are described in detail in the filing from September 2021.Ducat, which will be used for everyday transactions and as a store of value, is a stablecoin that is resistant to inflation and deflation.
The DAO’s governance token, called Locke, aims to stabilize tDucat and make it easier to manage its ecosystem. Municipalities, businesses, banks, cryptocurrency exchanges, and other DAO participants are planned to use these tokens.
American CryptoFed would become a reporting company after filing with the SEC and would then be required to submit regular reports to the regulatory body. The native ecosystem currencies of CryptoFed are designed to be utilized as utility tokens, according to the company’s white paper. By registering Ducat and Locke as securities, the DAO hoped to avoid any problems with the SEC and “ensure compliance with Securities laws and related regulations.”
