SEC’s Stiffness Towards ICOs with Regulatory Uncertainty Remains

As and when complexities accelerate following the ICOs and related activities, the U.S. Securities and Exchange Commission has become strict towards the upcoming ICOs and related perspectives following the investors’ protection. Most of the companies that may expect to come with their ICOs are at risk as jointly reported by Decrypt Media and Yahoo Finance on 10th October.

With the excessive token sales organized by more than hundreds of companies specialized in crypto and blockchain related businesses were expected to follow the laws. However, the authority has found that there are numerous companies have not generously followed the guidelines and regulations made by SEC. With the recent SEC’s stiffness in place, almost more than dozens of companies have agreed to refund the investors’ amount by paying fines for breaching laws.

Many companies towards which the SEC issued the orders under the authority of a court are neither have sufficient knowledge pertaining to satisfying commission demands of clients nor do they know to deal with the current matter.

While replying to the SEC’s stiffness towards the ICOs and crypto-based activities, an attorney dealing in security criticized the SEC’s attitude saying that SEC applies the same regulations to the ICOs based activities likewise it applies to stocks and bonds markets. With this, certain laws and regulations associated with existing ICO token are even not clear with regards to their identification and classification thereby creating ambiguity remain with them. The SEC has further commented in June 2018 that “Cryptocurrency would be regulated as Security”.

Based on the recent research conducted by Autonomous Research, ICOs are expected to have raised $20 billion since 2017 which is more than $18 billion than the previous year. Let’s not forget that amid all these, almost 80% of ICOs were supposed to be defrauded in 2017 alone as per the valid report published by Statis Group in July 2018. However, the U.S. is said to be one of the crypt friendly destinations in terms of organizing ICO based activities especially those that have acquired to raise capital through the ethical route!!

Shalin Soni

Shalin joined CryptoNewsZ as Associate Finance (Cryptocurrency Research & Analysis) in 2018 and has 10 years of collective experience to work on financial modeling and financial planning & analysis activities (fp&a) domains. He has worked with various organizations in India and added values by leveraging his skills and expertise. He has strong domain expertise in research & analysis, valuation, and fp&a!! You can also mail him at [email protected] to discuss anything related to his reports.
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