In brief

  • SALT Blockchain must offer refunds for its 2017 ICO, which raised $47 million.
  • The SEC ruled that it was an illegally unregistered securities offering.
  • ShapeShift CEO Erik Voorhees was reportedly a target of the investigation.

The United States Securities and Exchange Commission (SEC) announced today that SALT Blockchain, the company behind cryptocurrency-backed loan service SALT Lending, must refund customers that purchased its SALT tokens during an initial coin offering (ICO) in 2017.

According to the SEC, the ICO represented an illegally unregistered securities offering. All told, the ICO raised $47 million from June through December 2017, although an additional $1.2 million worth of SALT tokens were sold through August 2019.

SALT Blockchain, which the cease-and-desist order notes has been cooperative in the investigation, has agreed to issue refunds to any customers who purchased SALT tokens by the end of 2019. Once the refund program is launched, customers must register a claim within three months.


The firm must also pay a $250,000 civil fine to the SEC within 10 days, and will register the SALT token as a security. SALT tokens were originally sold for $10 apiece during the ICO, but now trade for just $0.05, according to CoinGecko.

SALT Lending launched in early 2018 following the ICO, allowing cryptocurrency owners to take out a loan with their own crypto used as collateral. That way, users are able to receive a cash loan without selling off their crypto holdings.

In November 2018, The Wall Street Journal reported that the company was under investigation by the SEC regarding its ICO. According to the report, SALT Lending had been served with a subpoena by the SEC in February 2018 seeking records related to the ICO.

In part, the investigation reportedly honed in on the involvement of crypto luminary Erik Voorhees, CEO of cryptocurrency exchange ShapeShift, who also served on SALT’s board. Voorhees had previously settled with the SEC in 2014 regarding an internet gambling company, which forced him to pay about $50,000 and agree to not raise money in private markets.

As such, Voorhees’ involvement in SALT Lending’s ICO was reportedly part of the initial focus of the SEC investigation, although he is not ultimately mentioned by name in today’s SEC order.


Editor's note: This article's headline was updated after publication to clarify that Salt Lending need only offer refunds on the money it raised in its ICO.

Daily Debrief Newsletter

Start every day with the top news stories right now, plus original features, a podcast, videos and more.