YEREVAN (CoinChapter.com) — The United States Securities and Exchange Commission (SEC) filed a lawsuit against Nova Labs, accusing the firm of offering unregistered crypto securities. The filing, dated Jan. 17, 2025, comes just days before SEC Chair Gary Gensler steps down on Jan. 20.
The SEC alleges that Nova Labs offered unregistered investment products, including “Hotspots” that mine Helium cryptocurrency (HNT) and a program called “Discovery Mapping.” This program reportedly allowed users to exchange personal data for crypto rewards.
Nova Labs Allegedly Misled Investors with False Claims
The SEC further claims that Nova Labs made misleading statements about its business partnerships. It alleges that Nova Labs falsely promoted that companies like Lime, Nestlé, and Salesforce used or relied on the Helium Network. According to the SEC, these companies did not engage with or depend on the network, as Nova Labs allegedly claimed.
SEC’s Broader Push Against Unregistered Crypto Securities
Under Gary Gensler’s leadership, the SEC has targeted several crypto firms for alleged violations. The term “unregistered securities” has become central to these cases.
In July 2023, Ripple Labs secured a partial legal win when a court ruled that XRP sales through exchanges did not qualify as unregistered securities. Despite this, the SEC contested the decision, filing an appeal to challenge the ruling.
The agency’s enforcement actions have created a challenging environment for blockchain companies trying to navigate securities laws.
Possible Shift in SEC Enforcement After Leadership Change
With Gensler stepping down on Jan. 20, the SEC may change its approach under new leadership. A Jan. 15 Reuters report, citing unnamed sources, suggested the agency could review or freeze certain cases. Specifically, cases involving allegations of securities law violations that do not include fraud might be paused.
This development could impact the ongoing litigation against Nova Labs. However, the lawsuit remains active, with the SEC pursuing its claims of unregistered securities offerings and misleading statements.
