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    The Trouble With Current Securities Laws For Blockchain And ICO Tokens

    Current Securities Laws For Blockchain And ICO Tokens

    The Chamber of Digital Commerce released a new report, which was the topic of a Bloomberg discussion between Perianne Boring, the Chamber’s founder, and former SEC Commissioner Paul Atkins.

    Here are the main points of the discussion:

    The Report Creates Operating Principles For Tokens

    Boring stated, in regard to the report, that the Chamber represents the blockchain technology industry. To date, it represents over 200 companies, including financial institutions and firms pioneering in crypto. The Chamber released the report to create operating principles for tokens, including utility tokens. Utility tokens is an asset of the community that is looking for more recognition.

    The Next Steps For The ICO Industry

    Atkins specifically responded to an inquiry as to what he would like to see for the ICO industry. In his response, Paul noted that the report was generated by over 300 people. The issue is that there are bad actors in the area and the government is currently going after them. However, there are also good actors who are trying to innovate and generate transformative and exciting technology.

    The report itself was a “private sector effort” trying to provide predictability and guidelines so that they can set forth their business. At the current rate, the law is based on general principles from court cases and securities, which makes it difficult for difficult to apply to their specific fact patter. The report helps individuals avoid trouble with legal and regulatory entities.

    Is The Report A “Band Aid” That Circumvents Regulation?

    Boring responded to the inquiry as to whether the report is equivalent to a “band aid” that circumvents regulation. In her response, she stated that that the initiative is not about circumventing regulation, but about recognizing the transformative potential of blockchain technology and applying “a governance structure that is appropriate for the transformative technology for what blockchain is.” The Chamber believes that both tangible and non-tangible assets can be tokenized, recorded, and traded on a blockchain. This will allow for a cheaper and more efficient ecosystem.

    Currently though, securities laws are not appropriate for digital tokens. Even though digital tokens can fall under the definition of a security, there are other projects out there where this is not the case. A “token” can represent a vote, a digital identity, a digital currency like Bitcoin, and so forth. If we apply all blockchain-based assets to apply to securities laws, it will not be operable with the new decentralized network and it will also prevent blockchain technology from flourishing in the United States.

    Why Does The World Need A Digital Currency?

    Atkins then responded to an inquiry as to why the world needs a digital currency. In his response, Paul stated “people will decide that for themselves.” In his own point of view, “it is more about the digital currencies.” And that there “are a lot of uses for digital currencies.” For instance, Ripple’s digital currencies allows for Business to Business and Bank to Bank transactions.

    Digital currencies have a lot of uses, ultimately. We are trying to “help people stay on the right path so that they don’t get in trouble with the law and that we can have a really robust development of this technology in the United States and so that people do not go abroad.”

    What Proportion Of ICOs Are Legitimate, Have Staying Power, And Represent Fundraisers For Legitimate Companies?

    Boring followed through with the next inquiry, which was what tokens represent legitimate staying power and represent fundraises Boring stated “tokens can represent beyond a fundraising activity. There certainly is fraud and abuse in the market.” The purpose of the Chamber is to bring the industry together and to combat such activity and to provide a platform for doing so.

    SEC Laws For Blockchain And ICO Tokens Conclusion

    Ultimately, the Chamber’s efforts are certainly interesting and the report is worth a read. The interview indicates that the Chamber is making sincere efforts toward influencing the state of cryptocurrency and ICOs.

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    B.E.G. Editorial Team is a gracious group of giving cryptocurrency advocates and blockchain believers who want to ensure we do our part in spreading digital currency awareness and adoption. We are a team of over forty individuals all working as a collective whole to produce around the clock daily news, reviews and insights regarding all major coin updates, token announcements and new releases. Make sure to read our editorial policies and follow us on Twitter, Join us in Telegram. Stay tuned. #bitcoin

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