BarnBridge DAO members were told to suspend “all work” related to the project following an investigation by the U.S. Securities and Exchange Commission (SEC).
on July 6th postal DAO lawyer Douglas Park broke the news to members on the platform’s Discord channel.
“Let me tell you, the SEC is investigating the BarnBridge DAO and individuals associated with the DAO,” Park said.
— Barn Bridge (@Barn_Bridge) July 7, 2023
To “reduce potential further legal liability,” Park suggested that “all work” on BarnBridge-related products should cease — including shutting down liquidity pools — and that individuals should not be compensated for their work for the DAO’s investment efforts.
Co-founder Tyler Ward (known as “Lord Tyler” on Discord) confirmed Park’s message was true a short time later on BarnBridge’s Discord.
Park and Ward did not explain why the SEC launched an investigation into the BarnBridge DAO. However, Parker explained that only limited information could be shared as the investigation is “ongoing” and “non-public”.
Between June 30th and July 3rd, 100% of BarnBridge (BOND) token holders— voted A proposal to retain the law firm of Park & Dibadj (Park is the managing partner of the law firm) as legal counsel to the DAO for “various legal work”.
A total of 213,000 votes were cast, of which 201,000 votes (or 94.3%) came from the wallet “barnbridge.eth”.
The timing and subject matter of the proposal may indicate that the SEC launched an investigation into the BarnBridge DAO before June 30.
However, some DAO members questioned the announcement.
A member of Discord asked for supporting evidence of the SEC investigation and suggested that BarnBridge’s founders may be using this as an excuse to promote an “exit strategy” that could defraud investors.
Ward dismissed the claims, saying it would be “the worst carpet attempt in history”.
Other members took the news more lightly, with one saying “it’s time to move to Europe” — suggesting that DAO members could avoid the SEC.
Another joked that anyone interacting with BarnBridge would be “shot” by SEC Chairman Gary Gensler on “live TV” — alluding to his tough stance on cryptocurrencies.
related: This little-known DeFi crypto token is up over 800% in a month
BarnBridge is a cross-platform risk management decentralized financial protocol that attempts to address inflation risk and interest rate volatility.
The price of its native token BOND has dropped 1.9% to $3.12 since the news broke, according to to CoinGecko. The token has fallen 98.3% since its all-time high of $185.7 on October 27, 2020, with a current market cap of $29 million.
Earlier last month, the SEC filed a lawsuit against two of the industry’s largest exchanges, Binance and Coinbase, accusing them of offering unregistered securities.
The reported investigation into BarnBridge, a small- to medium-sized DAO, may indicate that securities regulators don’t just want to target the largest organizations in the cryptocurrency space.
Cointelegraph reached out to the SEC for comment, but did not immediately hear back.
Magazine: AI Eye: AI’s ‘biggest ever’ leap, cool new tools, AI is the real DAO
Svlook
