The Securities Commission of South Carolina has issued a cease-and-desist order against Genesis Mining, a leading bitcoin and Ethereum cloud mining company, and Swiss Gold Global Inc., CoinDesk reported.

According to the regulator, the two firms sold mining contracts to the residents of Carolina that are considered securities. It alleged that while Swiss Gold Global acted as a broker-dealer for Genesis Mining, it had not registered in the state to offer securities.

“At all times relevant to this order, Respondent Genesis Mining continuously offered investment opportunities in Mining Contracts to South Carolina residents through its website. At no time relevant to the events stated herein was Respondent Swiss Gold Global registered with the Division as a broker-dealer, and no exemption from registration has been claimed by Respondent Swiss Gold Global,” the order states.

The Commission further clarified that the mining contracts offered and sold by the two companies “constitute investment contracts and are thus securities" under the state law.

Both, Swiss Gold Global and Genesis Mining, have not only been ordered to stop their business in the state, but also permanently barred from participating in any aspect of the securities industry in the state.