SEC Drops Dragonchain Crypto Lawsuit Over ICO

The U.S. Securities and Exchange Commission (SEC) has agreed to drop its lawsuit against blockchain firm Dragonchain, ending a long-running case over the sale of crypto tokens.

In a joint court filing made on April 24 in a federal court in Seattle, the SEC said the dismissal was “appropriate,” pointing to the work of its newly formed Crypto Task Force and a shift in its approach to digital assets. 

The court filing confirmed that the case would be dismissed “with prejudice,” meaning it cannot be brought back in the future. “The Commission and the Defendants stipulate that this Litigation be dismissed with prejudice […] and without costs or fees to either party,” the document stated.

The lawsuit was originally filed in August 2022 and accused Dragonchain of offering unregistered securities. 

According to the SEC, the company raised $14 million during a 2017 presale and ICO of its DRGN token. The agency also claimed Dragonchain made another $2.5 million from 2019 to 2022 to cover company expenses and build technology.

The SEC said Dragonchain should have registered the offering because it was considered an investment contract under U.S. law. The case was put on hold in October 2024 after Dragonchain made a settlement offer. 

In January 2025, the pause was extended after President Donald Trump signed an executive order pushing federal agencies to support leadership in digital assets.

The SEC launched its Crypto Task Force a day after the executive order. A memo shows SEC officials met with Dragonchain representatives on March 24. The meeting was led by Dragonchain founder Joe Roets, who argued that blockchain technology should not be seen only as a financial tool.

In the meeting, Roets explained how the platform could be used for fraud prevention, identity checks, and secure data storage.

Dragonchain was created by Disney in 2014 and later became an independent project. It allows companies to build secure applications using blockchain without sharing all data publicly. The company uses smart contracts written in everyday programming languages like Java and Python.

DRGN/USD Price Chart | Coingecko

Following news of the dismissal, Dragonchain’s DRGN token jumped 128% in 24 hours, according to CoinGecko. It’s still far below its all-time high of $5.46 in 2018, but the spike broke a months-long slump.