CBOE Global Markets’ Chris Concannon Says ICO Lawsuits & SEC Purge Bound to Happen
According to the President of CBOE, Chris Concannon, the ICO sector is about to witness an enormous shakeup, and investors should pay attention to these impending developments.
Chris further stated that the disruption would come in two waves. The first phase of the radical changes will involve tinkering of regulations, with the SEC categorizing ICO tokens as securities. After the deployment of the new laws, the watchdog will initiate the hunt for non-compliant participants and file lawsuits against them.
Usually, allegations similar to the one mentioned above are considered as dubious, especially if they come from a Wall Street trader. However, this situation might be different, since Concannon is a seasoned digital currency expert and his firm (CBOE) inaugurated Bitcoin futures trading in 2017. Regarding litigation, Chris is confident that the SEC will initially target investors participating in illicit crowdsales and then follow it up with filing cases against the blockchain projects and the event organizers, advisers, and teams.
The authorities in the United States have faced prolonged criticism for having what is perceived as an indistinct stance on virtual currencies and crowdsales. Nonetheless, Jay Clayton, the chairperson of SEC, recently stated that ICOs are not exempted from regulatory measures. He added that a majority of ICOs were actively selling securities and that SEC will soon start regulating such projects.
Concannon believes that all ICOs whose token sales entitle contributors to future dividends are the ones that will be categorized as securities by the SEC. Being a matter of substantial weightiness, Chris insists that startups should not neglect this inevitable occurrence. Since the turn of the year, the SEC has issued several subpoenas to blockchain-driven projects, a process that Concannon expects to continue in full throttle.
Despite the challenges, the ICO market is expected to raise a whopping $7 billion in 2018, a figure that is well over last year’s total of $4 billion. As per the new rules, the Sec will have the authority to ascertain which ICO projects are compliant. Projects that fail to comply will be considered as issuers of unregistered securities, which in itself is a punishable criminal offense.
The second wave will have dire implications in comparison to the first, as it renders non-complaint ICO projects entirely useless. Consequently, contributors to these projects lose all their investments without the possibility of a refund. Nevertheless, prosecution of this participants could pose a challenge, since most of them are likely to claim that organizers misled them.