BarnBridge DAO Settlement Hit By SEC With $1.7M Fine

Key Points:

• BarnBridge DAO settles with the SEC, paying $1.7 million over charges of unregistered crypto securities sales and operating unregistered investment companies.

• The BarnBridge DAO settlement includes $1.5 million in disgorgement and $125,000 in civil penalties for each founder, Ward and Murray.

• Its members unanimously agree to comply with the SEC, assigning special delegates, Ward and Murray, and authorizing token sales if needed.

The Securities and Exchange Commission (SEC) has announced a BarnBridge DAO settlement with its founders, Tyler Ward and Troy Murray, requiring a payment of over $1.7 million.

Read more: Barnbridge DAO Receives Regulatory Storm Attack From SEC

BarnBridge DAO Settlement With $1.7M Fine for Unregistered Crypto Sales

The charges revolve around the failure to register BarnBridge’s offer and sale of structured crypto asset securities, specifically the SMART Yield bonds. The Commission additionally cited violations related to operating SMART Yield pools as unregistered investment companies.

As part of the BarnBridge DAO settlement, BarnBridge will disgorge nearly $1.5 million in proceeds, while both Ward and Murray will individually pay $125,000 in civil penalties. The SEC found that SMART Yield bonds were marketed to the public as comparable to traditional asset-backed securities, attracting over $509 million in investments.

A white paper by Ward claimed that SMART Yield bonds aimed to provide the safety of traditional finance instruments with outsized returns through smart contract protocols. Investors could choose between “Senior” or “Junior” SMART Yield bonds on BarnBridge’s website.

Notably, BarnBridgeDAO members voted unanimously to comply with SEC requests, ending on October 12. Ward and Murray were designated as special delegates to address regulatory concerns, with Douglas Park serving as the DAO’s legal advisor. The DAO’s foundation was authorized to sell tokens if needed.

Without admitting guilt, BarnBridge, Ward, and Murray agreed to cease-and-desist orders, preventing further violations of registration provisions. The SEC orders reference remedial actions initiated by Ward and Murray in response to the regulatory scrutiny.

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