Resolution no. 21309

Suspension, pursuant to article 99, paragraph 1, letter b) of Legislative Decree no. 58/1998 ('Consolidated Law on Finance'), of the ''AirBit Club'' public offering of financial investments carried out through the websites https://airbitclub.com and www.bitbackoffice.com.

LA COMMISSIONE NAZIONALE PER LE SOCIETÀ E LA BORSA
[THE NATIONAL COMMISSION FOR COMPANIES AND THE STOCK EXCHANGE]

HAVING REGARD TO Law no. 216 of 7 June 1974 and subsequent amendments and supplements;

HAVING REGARD TO Legislative Decree no. 58 of 24 February 1998 and subsequent amendments and supplements ('Consolidated Law on Finance');

HAVING ESTABLISHED that, as a result of Consob's supervisory activity, the presence was noted on the web of the website https://airbitclub.com, the contents of which are also available in Italian, and the website www.bitbackoffice.com;

HAVING ESTABLISHED that the https://airbitclub.com website, also accessible through the web address www.airbitclub.com, “AirBit Club” offers potential investors the possibility of subscribing to three "memberships, called "Pro”, “Pro3" and “Pro7", for the amount, respectively, of 1,000, 3,000 and 7,000 Dollars, which, according to the website in question, allegedly give the right to receive up to 50% of any profits generated on the basis of a "compensation plan“ and through a so called "promotional transfer called Reward”. In particular, the website https://airbitclub.com offers potential investors the opportunity to subscribe to one of the above “Pro", “Pro3" and “Pro7” memberships, which allegedly differ from one another based on the length of the investment, the use of capital required and the duration of the investment (225, 234 and 243 days respectively);

HAVING ESTABLISHED that the website https://airbitclub.com also states that "Airbit Club" is allegedly "the world's largest crypto economy company, being a financial instrument for businessmen“ and that "based on the existing cryptocurrency pool and its increase with the sale of memberships it will [allegedly] be able to buy and sell large quantities of Bitcoin, Bitcoin Cash and Ethereum in international exchange houses and at the same time sell when the price rises. So, if profits are generated, they will be distributed up to 50% thereof among all the members of the Club through our compensation plan and a promotional transfer called Reward”;

HAVING ESTABLISHED, moreover, that the website www.bitbackoffice.com consists of a single page containing a notice that redirects users to the aforementioned website www.airbitclub.com/ https://airbitclub.com;

HAVING ESTABLISHED, furthermore, that generic references to "AirBit Club” have been identified on the websites https://airbitclub.com and www.bitbackoffice.com;

HAVING ESTABLISHED that the structure of the transaction is presented as an investment opportunity, in that the initiative promoted by “AirBit Club” would seem to offer users the possibility of purchasing “memberships” to receive returns that would be paid, at the end of a specific period of time, and would consist of a share of the revenues deriving from the activity that “AirBit Club” states that it carries out. The profits would derive from the activity of buying and selling large volumes of cryptocurrency carried out by “AirBit Club” which would then pass part of those profits (the returns) back to the investors participating in the initiative in question;

WHEREAS, according to the definition under Art. 1, para. 1, letter t) of Leg. Decree no. 58/1998, a "public offering [of financial products]” ) ” must be understood to mean ““ any invitation to offer or promotional message, in whatsoever form addressed to the public, whose objective is the sale or subscription of financial products including the allocation through authorised people;”'

WHEREAS the elements of the public offering relevant for the purposes of this provision can be summarised as follows:

a) the fact that the activity involves a specific or several specific "financial products", a category that includes - pursuant to Art. 1, para. 1, letter u), of the Consolidated Law on Finance, both the typified characteristics of "financial instruments" and "every other form of investment of a financial nature";”

b) the existence of a communication intended to persuade investors to purchase or subscribe one or more specific financial products and, consequently, including at the very least a description of their essential characteristics and conditions;

c) the fact that the offering in question is directed towards Italian residents;

WHEREAS the notion of an "investment of a financial nature" implies the presence of three elements at the same time: (i) an investment of capital; (ii) an expectation of return of a financial nature; (iii) the assumption of a risk connected to the investment of capital;

WHEREAS the structure of the operation in question envisages that (a) the user uses his/her own capital for the purchase of the so called “memberships” (b) by virtue of the aforesaid purchase he/she is promised a predetermined return (c) resulting in the assumption of a risk related to the use of the entrusted capital;

HAVING ESTABLISHED that the aforementioned return is paid against the use of the investor's capital, and that the return is related to the amount paid for the purchase of the so called “memberships”, and that the user is not asked to undertake any activity other than the mere contribution of capital;

WHEREAS, consequently, the consideration in the contract in question can be linked to the production of a financial return as fee for the use of capital transferred by the recipients of this return, who, therefore, invest their own money with the expectation of profit;

HAVING ESTABLISHED, therefore, that with regard to the existence of the requirement referred to in letter a), namely, that the offering in question can be classified as a "financial product", the investment considered, based on the foregoing, qualifies as an "investment of a financial nature";

HAVING ESTABLISHED that the initiative referred to is alleged to have been promoted in standardised and uniform terms, through a presentation of the initiative that contains a representation of the characteristics of the investment scheme in such a way as to render the investor capable of deciding whether or not to subscribe to it;

HAVING ESTABLISHED, therefore, that the requirement set out under letter b) is also met;

HAVING ESTABLISHED that the offer made through the websites https://airbitclub.com and www.bitbackoffice.com is ongoing and also addressed to Italian investors, as the website https://airbitclub.com, to which the website www.bitbackoffice.com refers, is also available in Italian;

CONSIDERING, therefore, that the requirement set out in letter c) is met, since the offering in question is aimed at the public resident in Italy;

HAVING ESTABLISHED, therefore, that the initiative set up by “AirBit Club”, to promote the purchase of the so called “memberships”, seems to constitute an offer to the public of financial products as defined above;

WHEREAS Article 94, paragraph 1 of the Consolidated Law on Finance states: "Persons who intend to make a public offering shall give advance notice thereof to CONSOB, attaching the prospectus to be published. To this end, for offerings to the public of EU financial instruments for which Italy is the Home State, and for offerings of financial products other than EU financial instruments, they shall give advance notice thereof to Consob, attaching the prospectus to be published. The prospectus cannot be published until it has been approved by Consob";

HAVING ESTABLISHED that, in relation to the activity described, neither prior notification nor the information prospectus intended for publication were sent to CONSOB;

HAVING ESTABLISHED that, on the basis of current evidence, the offering in question does not qualify for any of the exemptions - contemplated by the combined provisions of Art. 100 of Legislative Decree no. 58/98 and Art. 34-ter of CONSOB Regulation no. 11971/98 - from enforcement of the rules on "solicitation of public savings";

WHEREAS, therefore, there is a well-founded suspicion of the promotion of a public offering of financial products in breach of that legislation and the public offering of the financial products in question is still ongoing;

HAVING REGARD to Article 99, paragraph 1, letter b) of the Consolidated Law on Finance, on the basis of which Consob: "may suspend the public offering as a precautionary measure for a maximum of ninety days of products other than those specified under letter a)[i.e., Community financial instruments]in the event of a well-founded suspicion of violation of the provisions of this chapter or the related regulations”;

WHEREAS, given the existence of the above conditions, there is an urgent need to adopt the measure identified above;

RESOLVES:

That the offer to the public resident in Italy of the so-called “memberships”, set up by AirBit Club through the websites https://airbitclub.com and www.bitbackoffice.com., is suspended as a precautionary measure for a period of 90 days.

This resolution will be published in the Consob Bulletin and on Consob's website.

This measure may be appealed before the Regional Administrative Court of Lazio within 60 days.

March 25, 2020

THE CHAIRMAN
Paolo Savona