The US Securities and Exchange Commission (SEC) has rejected a Freedom of Information Request (FOIA) on the famous BitConnect virtual currency investment scheme, due to an exemption that is applied to the records linked to the law enforcement.
The FOIA that was sent by Florida-based lawyer David Silver was filed against BitConnect recently. Silver had previously tried to seek for an FOIA in the related controversial blockchain project Tezos that also rejected the proposal by sending the denial letter on February 6. SEC, however, didn’t deny or confirm the existence of any inquiry, even with the evidence of the rejection letters.
According to Silver who has already issued a copy of the newest letter to the CoinDesk, the investigators from the Commodity Futures Trading Commission (CFTC) have been contacted regarding the BitConnect issue and that the inquiry is in the process at the US commodities trade regulator. But the CFTC officials are yet to respond or comment on the subject matter.
Silver said that the decision by both SEC and CFTC to investigate But connect is a bit shocking. According to him, thousands of people who contacted him for the last one month have lost more than $1 billion. Silver also said that the investors in the cryptocurrency should be careful since the digital currencies are highly volatile, regardless of the type of digital exchanges including BitConnect, BitGrail, Kraken or even CoinCheck.
BitConnect have been the trending subject of various cease-and-desist notices especially from the US state regulators that have cried foul before the planned initial token offering. the situation worsened in mid-January when BitConnect announced that it was closing down its digital lending platform, a move that raised many questions among the cryptocurrency investors and has since made the value of the token plunge.
Last month, BitConnect’s assets were frozen following a lawsuit that was filed by the aggrieved investors and as a result, the price of the firm’s BCC token came tumbling down from £300 to $2.90 currently.