In line with a recent investigation by ‘Yahoo Finance and Decrypt Media,’ the authors of the report stressed that several crypto and blockchain startups that conducted token offerings have eventually found that that they had violated securities laws despite their endeavours to comply with the existing regulatory laws.
In response to SEC pressure, dozens of companies have reportedly quietly agreed to refund investors investment and pay fines, instead of conceiving to reach a legal compliance.
According to Yahoo and Decrypt’s conversations with over fifteen trade sources, several startups that were subpoenaed by the SEC didn’t knowledge to satisfy the commission’s demands, and were unable to consult alternative companies on a way to handle this matter.
Several workers of subpoenaed firms or their attorneys preferred most well-liked to remain anonymous because of the SEC restriction from revealing the issue.
An anonymous securities attorney at a high-profile Silicon Valley firm told Yahoo and decoded that while everybody’s holding their breath, looking forward to new rules, the SEC isn’t getting to offer them anything. In consistent with a anonymous attorney, while managing the recently emerged ecosystem, the SEC still applies the same laws, constant statutes, constant rules, to stocks and bonds and everything else.
As antecedently reported, there has been a cascade of uncertainty, related to the prevailing ICO token classification, that solely additionally complicates the development of urgently required new rules for ICOs.
While second major altcoin like Ethereum [ETH] was launched back in the year 2015, the SEC expressed that the cryptocurrency would be regulated as a security solely in June this year. Despite demands for regulative clarity and comments from lawmakers that the ICO ecosystem requires light touch regulation, the SEC continues its stifling on ICOs.
According to a recent study by the Financial analysis firm ‘Autonomous Research’, ICOs raised around $20 Bln since the beginning of 2017, that is $18 Bln time more than the previous year.
With that, over 80% of ICOs that were concluded in 2017 came to be identified as scams by the ICO informatory firm ‘Statis Group’ in July this year. Still, the United States is graded among the most friendly country for the ICOs market, supporting fund raising by top firms within the field.