During a public forum held on June 13 by the Securities and Exchange Commission (SEC), captioned, “Investing in America: Atlanta Town Hall Meeting”, a highly anticipated event open to the general public and streamed live on the SEC website, speaker after speaker shared their thoughts about blockchain technology and other related matters.
The public forum was primarily intended to address issues regarding cryptocurrency regulations and innovations. The common thread in much of the discussions was the expressed desire of regulators and their favorable disposition towards blockchain technology innovations. They however cautioned that industry player hasten slowly so as to guard against the possibility of individual and retail investors falling victim to the activities of fraudsters.
The SEC chairman, Jay Clayton who reportedly earned the accolade, ‘apologist for blockchain’ barely a few months ago asserted his optimism about the inherent potential of blockchain technology. He held that regulations that had governed and and helped develop the US equities markets had remained unchanged and were still relevant and applicable today, hence the need to fully comply with them. He stated that he “expects them to be followed”.
“Blockchain technology has incredible promise for securities and other industries. I think we all can agree on that… It greatly reduces transactions costs, including the costs of verification. It’s a powerful technology… That technology, people have used to apply to fundraising… we’ve had pretty clear…rules on how to conduct fundraising when you’re offering securities. Much of what I have seen in the ICO or token or ICO space, is a security offering… I don’t know how much more clear I can be about it,” Clayton explained.
His assertions come on the heels of a much earlier statement he issued in April where he sought to suggest that even though some ICOs are legitimate, it does not in any way negate the fact that many ICO industry players engage in activities that are at odds with federal regulations that govern securities offerings.
Speakers assured industry players of their resolve to move with the times as it were; they admitted that many investment types were becoming more and more complex and technologically forward looking, hence the need for the commission to invest in the improvement of both technology and data in order to keep up with the changing trends with the ultimate goal of improving security.
“[Cryptocurrency] has the potential to reduce the cost of investing. It could decease the cost of capital allocation. We are being challenged, we are being disrupted like everybody else is… and one of the things we’re thinking about is how embrace the innovation and make sure it’s used effectively. One thing we are thinking through is how to ideally anticipate and prevent problems before they arise,” said Kara Stein, SEC Commissioner.
She added: “I think remaining competitive requires, both us as regulators and market participants, to thoughtfully evolve with the innovation and not react to it after the fact,” she added. “For example, there are increased risks for pump and dumps and Ponzi schemes, perhaps, because it’s so easy to now invest in that hotel resort community in some African nation.”
If ever you were in doubt as to whether ICO`s are securities, now you know, right?
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