ICOBox

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ICOs, aka Initial Coin Offerings, are excellent ways for start-up companies to market their technologies and services

Interestingly enough, ICOs originated almost a decade ago and peaked around 2017-2018. If you are new to the sector, think of ICOs as IPOs (Initial Public Offerings). Crypto entrepreneurs can promote their ideas and raise funds for development work, while investors can buy a stake and eventually profit from the new venture.

This ICO gold rush sounds great, right?

The sad truth, however, is that when money is involved, there is always some fraud risk. And ICO scams are no exception! Did you know that according to data presented by CoinMarketCap, 78% of ICOs in 2017 were fraudulent?

And among them, ICOBox was one of the biggest scandals in the sector.

Note that this website is not connected to the previous ICOBox platform. We prioritise users, and while we believe that companies and services should promote their crypto projects, we do not support any illicit activities.

ICOBox: Initial Coin Offerings Down in the Mud

How would you explain that a company supposed to offer digital assets to investors provided tokens with little to no value ? The same company spearheaded the job of misleading over 2,000 token holders into buying unregistered ICOS tokens worth over $14.6 million.

That is the story of ICOBox - the organisation that paraded itself as a leading ICO provider and marketing services facilitator for many cryptocurrency projects. Interestingly, some prominent crypto projects included Patron, Paragon, Storiqa, and a host of others that were later found to be unregistered.

What Was ICOBox ?

ICOBox was promoted as "the first and the biggest new generation blockchain growth promoter and Business Facilitator for companies seeking to sell their products via ICO crowd sales."

Founded in 2017 with headquarters in Vancouver, Canada, the former ICOBox website was launched by Nickolay Evdokimov, Daria Generalova, Mike Raitsyn, and Anar Babaev, intending to scale the effectiveness of blockchain technologies. In its quest to produce and market companies with great features and products, the company grew its employees, signing over 20 people… before taking the wrong path.

Founded in 2017 with headquarters in Vancouver, Canada, the former ICOBox website was launched by Nickolay Evdokimov, Daria Generalova, Mike Raitsyn, and Anar Babaev, intending to scale the effectiveness of blockchain technologies. In its quest to produce and market companies with great features and products, the company grew its employees, signing over 20 people… before taking the wrong path.

ICOBox's CEO, Nick Evdokimov, involved the company in offering illegal securities to investors. To make matters worse, the company failed to conduct proper registration as a broker while selling almost valueless ICO projects to its customers. The US Securities and Exchange Commission (SEC) caught the report, and more trouble loomed for the team.

What Happened to ICOBox? Battling the SEC

Following the report, a judgement against ICOBox and Nilkolay Evdokimov was entered for conducting illegal securities and other digital asset offerings and also for acting as unregistered brokers. In fact, in the original filing, it was stated that the company acted as an unregistered securities broker and facilitated 30 token sales, raising over $650 million.

The court concluded that ICOBox violated " the securities registration provisions of Sections 5(a) and 5(c) of the Securities Act of 1933 and the broker registration provisions of Section 15(a) of the Securities Exchange Act of 1934."

What happened after? ICOBox's owner Evdokimov was ordered to pay penalties, including a civil penalty, for over $16 million . On top of that, his venture is now banned from marketing and selling assets in the US.

What Happened to ICOBox's Owner?

With the SEC's eyes on finding loopholes in new cryptocurrency organisations and cracking unregistered broker activities, ICOBox was found guilty of exposing unsuspecting investors to risky, unregulated investments. The judgement also banned the company from participating in other marketing projects selling tokens.

In the end, Nick Evdokimov was proscribed as an ICO fraud.

We should mention that a deeper investigation conducted by AltcoinBuzz shows that perhaps Evdokimov is not new to Ponzi schemes and fraud and is still rampant in his activities.

Why Was ICOBox Sued by the SEC in the First Place?

Without digging into legal technicalities, ICOBox was selling tokens as unregistered securities to unaccredited investors and breaching securities laws. So it’s no surprise the SEC sought justice.

As expert Michel Wein Layne said, "By ignoring the registration requirements of the federal securities laws, ICOBox and Evdokimov exposed investors to investments, which are now virtually worthless, without providing information that is critical to making informed investment decisions." True, ICOBox's digital tokens the company was promoting, called ICOS tokens, are worthless now.

Here we should mention that ICOBox is not the only company sued for fraud. Given that regulations are still catching up with technologies, the SEC keeps seeking clarity and has warned many projects, including Airforx and Gladius Network, that it would treat ICOs as unregistered securities sales.

Why Is This Story Important?

While spotting fraud years ago might have been difficult, the story of ICOBox and the report by the SEC that took years to reach an effective ruling of the court are relevant today.

Why? Because researching ICOs is crucial to help you limit losses as you risk losing your entire capital.

  • Always do your research.
  • Read the whitepaper available.
  • Make sure the team is reputable and compliant with all the local rules and regulations.

Once again, when it comes to ICOs in the US, remember that the SEC has repeated numerous times that virtual assets should comply with US securities laws and the 1933 Securities Act. So carry on due diligence!

Birth of a New Service: The Brand New ICOBox

Having entirely detached itself from the old website, this brand new ICOBox site is committed to serving users and improving cryptocurrency adoption by providing transparent information and positive user experiences.

Be first out of the box! Get updated market information with the new ICOBox website NOW.