A few days after the US Securities and Exchange Commission (SEC) came out with their latest announcement, including the ruling against the founders of the AirToken and Paragon Coin, KuCoin has delisted a fresh batch of coins from its exchange claiming that the mentioned projects failed its Special Treatment tests. This could be a follow up to the currently very fragile legal line that differentiates utility tokens and security tokens.

Both Paragon and AirToken have been initially marketed as non-security tokens, with both of them collecting over 10 million USD during their respective ICOs. AirToken has marketed the project as an attempt on banking the unbanked with different financial services (including loans), while Paragon has been building supply chain solutions for the cannabis industry.

Now these projects are worth less than 90% of their original values and have been ruled as security tokens by the US SEC. The ruling included a $250k fine and refund to the investors who can prove that they suffered a loss after the ICO.

KuCoin raised $20 million

KuCoin is based in a highly regulated environment namely Singapore. The exchange just finished their Series A funding round as well, where it successfully raised $20 million from a few of the biggest crypto venture funds.

This allows us to speculate that the delistings might have something to do with the fact that KuCoin expanding into different markets thanks to the capital injection and is cleaning up the house after the ICO crack-downs recently.

KuCoin looking into projects

KuCoin is seemingly the first exchange after the recent rulings to issue instant delistings. The announcement came today, but what the probably most interesting part is that it doesn’t really mention the exact reason for the cancelations (except that these projects fall into the Special Treatment category). Moreover, KuCoin only gave 1 day for possible withdrawals. A single day withdrawal period is unheard of within the crypto scene, we have never seen anything similar.

The projects affected are the following:

Some of the tokens mentioned here have relative smaller market caps with less volume, but a few of them like RDN and BCPT stand out as these are listed on several major exchanges and had achieved high volumes during better market environments.

While these tokens were marketed as utility tokens, the recent advancements in international rulings makes us wonder if these are rather closer to securities.