The United States Securities and Exchange Commission, or SEC, has announced charges against Hydrogen Technology Corporation and its market marker Moonwalkers Trading Limited related to allegedly perpetrating a scheme to manipulate the trading volume and price of Hydro tokens.

In a Sept. 28 announcement, the SEC said former Hydrogen CEO Michael Ross Kane hired Moonwalkers and its CEO Tyler Ostern “to create the false appearance of robust market activity” following the distribution of Hydro tokens through an airdrop, bounty programs, and direct sales in 2018. Kane then had Moonwalkers sell the tokens in the “artificially inflated market” for more than $2 million in profit on behalf of Hydrogen.

“As we allege, the defendants profited from their manipulation by creating a misleading picture of Hydro’s market activity,” said Joseph Sansone, chief of the SEC Enforcement Division’s market abuse unit. “The SEC is committed to ensuring fair markets for all types of securities and will continue to expose and hold market manipulators accountable.”

According to the SEC, Kane’s, Ostern’s, and the companies’ actions constituted manipulation of the crypto market, violating provisions of U.S. securities laws. The regulator reported Ostern had consented to pay more than $40,000 in disgorgement and interest, subject to approval by a New York federal court “with civil monetary penalties to be determined at a later date.” The SEC’s complaint sought similar actions against Kane, as well as having the former CEO barred from holding officer and director positions.

Many in the crypto space criticized the SEC complaint as an example of regulation by enforcement — in this case, claiming the regulator was extending airdrops to its purview.

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