Robert Jackson, the Commissioner of the United States’ Securities and Exchange Commission (SEC) recently announced that the initial coin offerings (ICOs) will be legitimized under existing securities regulations.
Despite the optimism shown by SEC on the future of cryptocurrency markets, Robert Jackson has criticized the present state of the Initial Coin Offerings (ICOs). He is of the opinion that investors are having a difficult time in differentiating between true, valuable investments and frauds in today’s ICO market.
Apart from criticizing ICOs, he also announced that the SEC is taking steps to protect investors who have been hurt in the ICO market. William Hinman, director of the Division of Corporation Finance of SEC, claims his agency is developing a balanced framework for regulating the cryptocurrencies. Through this approach, they want to ensure there is an appropriate amount of capital formation, with strong investor protection simultaneously.
The new framework is needed because most of the SEC regulations are from Securities Act of 1933, which means the regulations are almost 80 years old! With the landscape having changed massively in just the past decade itself, many ICOs come with different business plans and solutions, which demands the need for a new set of regulations!
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