#SEC Sues Nova Labs for Fraud#

The U.S. Securities and Exchange Commission (SEC) filed a lawsuit on January 17, 2025, against Nova Labs, Inc., alleging that the company has been conducting unregistered offerings and sales of crypto asset securities since April 2019 through the sale of "Hotspots" devices and the "Discovery Mapping" program, defrauding investors. The SEC alleges that Nova Labs conducted unregistered offers and sales of securities in connection with offering and selling electronic devices known as "Hotspots" (used to mine Nova Labs' crypto assets) and the "Discovery Mapping" program (which allowed users to exchange their private data for Nova Labs crypto assets). The SEC believes that Nova Labs' actions violated federal securities laws and has sought a permanent injunction against Nova Labs, disgorgement of ill-gotten gains, prejudgment interest, and civil penalties. The lawsuit highlights the SEC's continued commitment to combating fraud in the cryptocurrency industry and emphasizes the need for compliance with securities laws in the issuance and sale of crypto assets.