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The US stock exchange regulator and ICOs

A cautious opening towards token sales on the official website of the US stock exchange regulator

The US stock exchange regulator and ICOs: Leggi qui l’articolo in Italiano.

The Security and Exchange Commission updates its vision of ICOs and communicates it through an obvious change on its institutional website.

Starting from a situation of distrust and almost complete closure, the SEC is now moving to a cautious opening, giving prudential guidance to potential investors.

The renewed SEC website divides the information into three sections:

  • general information;
  • information for investors;
  • information for market operators.

On the generic website, there is a description of ICOs as an investment tool and the essential points that describe the tokens sales are highlighted, with a view more aimed at promoters.

It is generally stated that :

  • ICOs, based on specific facts, may be securities offerings;
  • ICOs that are securities must be subject to SEC regulations;
  • The tokens issued may have different functions and the mere fact that they are utility tokens does not exempt them from SEC control;
  • They can present substantial risks of loss;
  • If there are any doubts, it is always recommended to ask questions and demand clear answers

The SEC then moves on to providing guidance to investors:

  • They must recognize that these products often come from international markets and are subject to different regulations, and the SEC may not be able to intervene;
  • Consult certified and professional consultants for information;
  • If an investment sounds too good to be true, exercise extreme caution;
  • Monitor the markets in which you traded and their efficiency.

Finally, the details for intermediaries and professional operators, who must:

  • Be cautious about promoting ICOs;
  • Remember that it is the duty of professional operators to protect the interests of savers;
  • Read the information that distinguishes general tokens from those considered securities;
  • Find out about exchanges and assess whether they are required to be registered or not.

These are indications of common sense, which go far beyond a generic and a priori closure to the world of cryptocurrencies and token sales, but which opens both to the possibility of ICOs registered as securities, and to the existence of real utility tokens, although the SEC remains as the body of discrimination between the two categories.

Fabio Lugano
Fabio Lugano
Graduated with honors from Bocconi University, Fabio is a consultant for companies and wounded shareholders of the Banche Venete. He is also the author of "Scenari Economici", and lecturer and analyst of cryptocurrencies since 2016.