SEC believes cryptocurrencies are here to stay and wants to open dialogue with leaders in the space regarding regulation. Chairman Jay Clayton has asked ICOs and crypto companies to comply with a law saying they are watching them
Many ICOs and cryptocurrencies so far held or being held can be categorized as securities according to the United States Securities and Exchange Commission chairman Jay Clayton. He says many of the people selling ICOs think they can avoid the regulations as securities. Instead prefers a limited disclosure from a private placement and public trading and public offering of the token.
Speaking to FOX Business, he said SEC is “watching” and also “others are watching”, It is to ensure that they are adhering to the securities regulation. Additionally, he asked.
He is concerned that some companies fail to raise money for the traditional private placement and has to switch to ICO fundraising mode.
“The business hasn’t changed substantively, but it’s a form-over-substance way to raise money. That is troubling”.
For instance, that can be disturbing for investors who think that the business will work now that it switched fundraising mode.
He says many investors think that they are protecting their tokens, in the same manner. However, they are treats for New York Stock Exchange or NASDAQ listings. However, this is not so. He, therefore, asked investors to think “long and hard” before.
The statements by Clayton comes even as Telegram broke the record to raise $850 million. So far in the first two months of its ICO. It expects to raise $2 billion.
Clayton thinks cryptocurrency asset class is here to stay and wants to open dialogue with companies leading the space. SEC balances are regulating cryptocurrencies with legitimate growth.
He, however, told FOX Business that securities law do apply in the crypto world. However, urging companies to comply and not skirt the rules since SEC would deal with them if they do so.
“It’s a technology with great promise. It’s a technology that I really think is pretty cool and can change the way people do business with a great deal of efficiency. But it doesn’t mean that you can obviate our tried-and-true approach to the federal securities laws”.