The Philippine Securities and Exchange Commission (SEC) has issued a cease and desist order against cryptocurrency company Payasian Corporation.

In a report, regulators ordered the company to “stop enticing the public to invest” in a cryptocurrency called Paya “without the necessary license.”

In its order, the SEC ordered Payasian to “immediately cease and desist under pain of contempt from further engaging in, promoting and facilitating selling and/or offering for sale securities in the form of investment contracts and/or other activities/transactions.”

In addition, Payasian will also be prohibited from engaging in transactions involving funds in its depository banks and “from transferring, disposing, or conveying in any manner all related assets for the benefit of the investors.”

No authority to sell securities

According to the order, Payasian was registered as a corporation in August 2019 and claimed to be connected to Payasian Solutions Pte. Ltd. located in Singapore.

However, the regulator said the company’s certificate of registration does not include an authority for the firm to sell or offer securities to the public.

The SEC requires a secondary license for this, which it notes Payasia did not secure. The agency claims that evidence shows Payasian engaging in the sale and offering of securities in the form of investment contracts without the requisite license.”

According to regulators, Payasian is offering potential investors an investment opportunity to buy cryptocurrencies called “Paya” coins. The firm reportedly encourages investors to hold their Paya coins for six months so that they can receive 30% additional Paya Rewards.

“Sharer” and other schemes

In addition to investing, the company offers investors referral rewards, “sharer packages,” and commission schemes.

The order describes how Payasian offered “Sharer Packages” starting at PhP 8,145 (US$160) for 1,040 Paya tokens with a maximum commission of PhP500 (US$9.8) a day.

An individual can invest as much Php 5.8 million [US$113, 850] to buy 740,749 Paya tokens and receive a maximum commission of PhP10,000 [US$196] a day.

“Without the registration statement duly filed with and approved by this Commission, Payasian’s act of selling/offering ‘Sharer Packages’ which are securities in the form of investment contracts constitutes a clear violation of (the SRC). This warrants and justifies the immediate issuance of a cease and desist order,” the regulator said.

Regulators across the globe continue to monitor rules and regulations on cryptocurrency.

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