SEC Shares New Initial Coin Offering (ICO) Token Enforcement Actions As Legal Activity Picks Up
SEC Announces Enforcement Actions Related To Initial Coin Offerings During 2018
The U.S. Securities and Exchange Commission (SEC) released its annual enforcement report. The document reveals dozens of different actions that have been taken against Initial Coin Offerings in 2018. Some of these enforcement actions were not known until now that they were made public by the U.S. regulatory agency.
At close of FY 2018, we brought over a dozen standalone enforcement actions involving digital assets and ICOs. https://t.co/1uQ6udWD1d
— SEC_News (@SEC_News) November 14, 2018
This report shows that there are several ICOs that are still ongoing and operational. Nevertheless, this calls the attention of some analysts since the SEC would allow companies to generate revenue if they are not involved in fraudulent or criminal activities. But in this case, the balance sheets of these firms are seriously damaged with fines.
The report says that they recommended enforcement actions to the Commission in matters involving Initial Coin Offerings. As mentioned before, some of these ICOs are still operating in the market.
About ICOs, the report reads as follows:
“Led by the Cyber Unit, the Division emerged as a global leader in addressing misconduct relating to digital assets and initial coin offerings (ICOs). We believe our approach to enforcement in this space has been thoughtful and consistent. Importantly, it has provided a template for authorities in other countries, where fraud and misconduct targeting U.S. investors often have been based.”
The SEC informs that due to the expansion of ICOs during the last year, they tried to pursue cases to deliver broad messages and have market impact. This is why they have worked with the Commission’s trading suspension authority, and they have issued different public statements. About it, the agency believes that they were able to perform a good task protecting investors from fraudulent ICOs and other scams.
The last week, at the Fintech Week Conference in D.C., the director of Corporation Finance for the SEC, William Hinman, announced that they would be issuing a ‘plain English guidance’ on Initial Coin Offerings. The intention is to provide clarity to investors and increase certainty among market players.
In order to regulate the market, the agency is currently laying down guidelines for people to follow. Moreover, the agency classifies blockchain businesses in a certain way for them to fit under traditional laws.