In line with a recent investigation by ‘Yahoo Finance and Decrypt Media,’ the authors of the report stressed that severalcrypto and blockchain startups that conducted token offerings have eventually found thatthat they hadviolatedsecurities laws despite their endeavours tocomply with the existing regulatory laws.
In response to SEC pressure, dozens ofcompanieshave reportedly quietly agreed to refund investorsinvestmentand pay fines,instead ofconceiving toreach a legal compliance.
According to Yahoo and Decrypt’s conversations withoverfifteentradesources,severalstartups that were subpoenaed by the SECdidn’tknowledgeto satisfy the commission’s demands, and were unable toconsult alternativecompaniesona way tohandle this matter.
Severalworkersof subpoenaedfirmsor their attorneys preferredmost well-likedto remain anonymous becauseofthe SEC restriction fromrevealingthe issue.
An anonymous securitiesattorneyat a high-profileSilicon Valleyfirm told Yahoo and decoded that while everybody’s holding their breath,looking forward tonew rules, the SECisn’tgetting toofferthem anything. In consistent witha anonymousattorney,whilemanagingthe recently emergedecosystem, the SEC still applies the same laws,constantstatutes,constantrules, to stocks and bonds and everything else.
Asantecedentlyreported, there has been a cascade of uncertainty,related tothe prevailingICO token classification,thatsolelyadditionallycomplicatesthe developmentofurgentlyrequirednew rulesfor ICOs.
While second major altcoin like Ethereum [ETH] was launched back inthe year2015, the SECexpressed that the cryptocurrency would be regulated as a securitysolelyinJunethis year. Despitedemands forregulative clarity and comments from lawmakers that the ICOecosystemrequireslight touch regulation, the SEC continues itsstiflingon ICOs.
According to a recent study bythe Financialanalysisfirm ‘AutonomousResearch’, ICOs raised around $20 Bln sincethe beginningof 2017,thatis $18 Bln time more than the previous year.
With that,over80%of ICOs that were concluded in 2017came to beidentifiedas scams by the ICOinformatoryfirm ‘StatisGroup’inJuly this year. Still, the United States isgradedamong the most friendly country for the ICOs market,supporting fund raising bytopfirmswithin thefield.