US SEC Points Out Dedicated ICO Guide In the Midst of Ongoing Regulatory Debate

Article by · February 11, 2019 ·

The guidelines on initial coin offerings (ICOs) was reechoed by the United State Securities and Exchange Commission (SEC) in a tweet Feb. 10, as the commission continues to work towards formalizing the sector.

Presently, five aspects of ICOs which are considered as essential by the SEC, and also a separate section for investors and market professionals were listed by a dedicated section of the regulator’s website.

It seems like the content has been there since last year March, with the SEC planning to attract renewed interest to it this weekend on social media.

The current perspective of the organization seems to be summarized in the five descriptive aspects listed. Among these is the confirmation a token provided in an ICO which can be security which requires registration with the SEC, notwithstanding how it is being referred to by its issuer.

Familiar reference was made by the guide to dangers involved for investors and calls on to them to carry out their own investigation prior to parting with any capital.

“Companies and individuals are increasingly considering initial coin offerings (ICOs) as a way to raise capital or participate in investment opportunities,” according to a summary of the guide:

“While these digital assets and the technology behind them may present a new and efficient means for carrying out financial transactions, they also bring an increased risk of fraud and manipulation because the markets for these assets are less regulated than traditional capital markets.”

Substantial testimony about ICOs as part of a hearing on cryptocurrency, similarly underscoring the requirements for investor protection was given last week by the  SEC chairman, Jay Clayton.

Heister Peirce, an SEC commissioner commented on Friday, Feb. 8, that more freedom may be granted for the industry to move on its own following the suspension in the establishment of crypto regulation.

However, the partnership was made at a time when the ICO industry is presently a fraction of its former size when it comes to market capitalization. An earlier report reveals that some ICO tokens presently trade better under their issuance price, while over 90 percent of their value was lost by many.

In December, The CEO of Hong Kong cryptocurrency trading platform BitMEX, Arthur Hayes informed the press in December that he is expecting an ICO market resurgence by 2020.


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