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Jay Clayton, the chairman of the U.S. Securities and Exchange Commission (SEC), recently discussed the current regulatory climate surrounding initial coin offerings (ICOs). Clayton emphasized that all ICOs must register with the SEC to ensure compliance with U.S. law.
Also Read:Â Estonia to Tighten Rules for Licensed Crypto Companies
Requirements for Regulatory Compliance
The SEC chairman reiterated that the SEC does not see bitcoin as a security. However, it does view the tokens that are offered in many ICOs as securities. âIf youâre going to offer and sell securities, you have to do that in compliance with our laws,â Clayton said.
Recent regulatory moves by the SEC against ICOs âfurther emphasize that our securities laws do apply to the ICO space,â he added. âIf people are going to raise money using initial coin offerings, they either have to do so in a private placement, or they have to register with the SEC ⊠when you register with the SEC, youâve got to provide financial statements and disclosure along the lines that we would expect.â
When asked if all ICOs are noncompliant, Clayton responded by simply noting that he hasnât seen any ICOs register with the SEC. He acknowledged that ICOs âconducted off-shoreâ or those that are âpursuant to a private placement exemptionâ could fall outside of the SECâs regulatory purview. However, he added that âto the extent that youâve conducted a public offering in an ICO, itâs noncompliant.â
No Comment on Timing of ETF
When asked about the proposed Vaneck bitcoin exchange-traded fund (ETF), Clayton declined to âcomment on timing.â However, he asserted that the SEC has been clear about several matters of regulatory concern. Among the issues it has identified are âwhether there is reliable price information on trading markets.â The SEC has also looked at concerns about custody, particularly âwhether people who hold those assets can count on those assets to be there in the same way you can with other assets that underlie an ETF.â
In a recent appearance on the âWhat Bitcoin Didâ podcast, SEC Commissioner Hester Peirce discussed the SECâs decision to reject nine proposed bitcoin ETFs earlier this year. She stated that the the commission has a tendency to âsometimes look at crypto and ⊠say, âwell it is very different from any other asset classâ.â However, she added that while the notion is âto some degree true ⊠there are similarities with other asset classes if you look at something like gold.â
Do you think that ICOs will begin to register with the SEC as cryptocurrency becomes more mainstream? Share your thoughts in the comments section below.
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The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.