The Securities and Exchange Commission (SEC) has resolved to revoke the licence of Longroot (Thailand) that enabled it to operate as a digital token offering (ICO) portal service provider effective as of Monday, due to the company's failure to comply with criteria set by the regulator.
According to the SEC's statement, Longroot could not maintain its financial qualification as well as personnel structure and work system as required by the regulator, and did not prepare and submit reports related to its IT system to the SEC within the period specified.
Therefore, the company is considered to be incapable of complying with the SEC's criteria and unable to correct all related shortcomings in order to operate the services of an ICO portal appropriately, it added.
"The SEC is authorised to supervise ICO portals to comply with relevant regulations and ICO portals must maintain the qualifications set by the SEC board at all times of doing business and providing services for the benefit of investors," the statement noted.
According to the regulator, Long‑ root currently has no customers or outstanding transactions. In a related development, digital asset prices staged a rebound on Tuesday after facing a hefty selloff on Monday along with other risky assets, including stocks, on fears of a US economic recession.
According to CoinGecko, crypto market cap worth US$270 million was lost on Monday as the price of Bitcoin fell 11%, along with a 21% drop in the price of Ethereum, along with other risky assets.
On Tuesday, crypto prices recovered somewhat, with Bitcoin surging 4% to $55,441, Ethereum rising 7% to $2,497 and Binance Coin (BNB) rising 9% to $480.
The sell-off in crypto markets was in line with the decline in Asian stocks.
Japan's Nikkei 225 index fell by as much as 7%, extending losses that began last week after the Bank of Japan said it would raise interest rates to their highest level in 16 years.
The Nasdaq dipped 3.4% last week, entering correction territory, sending the tech-heavy index to its worst three-week losing streak since September 2022, led by declines in Amazon and Nvidia stocks.
Last week's decline was due to disappointing earnings results, couple with a weaker than expected US jobs report, a higher rate of unemployment and a slowdown in the manufacturing sector.
The declines prompted analysts to believe that the Federal Reserve would cut interest rates in September by 0.5%, from a range of 5.25-5.50% at present.