The Securities and Exchange Commission (SEC) has released an updated set of guidelines on initial coin offerings (ICOs).
The new guidelines now sit in a dedicated and prominent section of the regulator’s website: SEC.gov/ico. This page now lists five aspects of ICOs the SEC considers essential, as well as a separate section for investors and market professionals.
Our guide to initial coin offerings: https://t.co/N1cfvEjmM6
— SEC_News (@SEC_News) February 10, 2019
The content appears to have existed since March last year, with the SEC opting to draw renewed attention to the new page this week. The material is a relatively understandable collection of advice for the ICO sector by the SEC, coming in the form of a user guide instead of technical literature.
The five descriptive areas listed appear to summarise the organisation’s current perspective. These include confirmation that a token issued in an ICO can be a security in need of registration with the SEC (regardless of how its issuer refers to it).
The guide also makes familiar reference to the risks involved for investors and asks them to do their own research before parting with any capital.
The guidelines state that “companies and individuals are increasingly considering initial coin offerings (ICOs) as a way to raise capital or participate in investment opportunities.”
“While these digital assets and the technology behind them may present a new and efficient means for carrying out financial transactions, they also bring an increased risk of fraud and manipulation because the markets for these assets are less regulated than traditional capital markets.”
SEC jurisdiction over the token economy
Just last Friday, Hester Peirce (one of five commissioners in the SEC) gave a speech about what she believes is the optimal level of regulatory oversight required to foster innovation and entrepreneurship in the token ecosystem.