SEC Chairman Jay Clayton: ICO is not a scam at all
Speaking at an event at Princeton University, the chairman of the US Securities and Exchange Commission, Jay Clayton, in response to a question whether all ICOs without exception are fraudulent, said that this is “not at all true.”.
According to Clayton, the measures that his department is taking in recent months should help, not hinder the formation of the cryptocurrency industry..
“Does the approach adopted by the SEC in Washington have a negative impact on distributed ledger technology in other areas? In a nutshell, I hope it helps, because this technology is used to carry out fraudulent activities, ”he explained. “I believe that if we don’t stop the fraudsters, the risk of the regulatory pendulum swinging is very high. The actions of the regulators will be so brutal that they will limit the possibilities of this new type of securities. “.
One of the problems regulators see in this area, Clayton said, is the attempts to classify the offer of blockchain startups as the distribution of utility tokens, which, according to the organizers of such campaigns, should exempt them from the obligation to comply with the requirements of the securities law. At the same time, in fact, most of these tokens have the characteristics of securities.
If a startup “offers something that depends on the efforts of others, that something should be regulated like a security,” Clayton said..
“If I have a laundry token for washing things, it’s not a security. But if I have a set of 10 such tokens, and laundry machines are just being developed, despite the fact that I can use the tokens in the future and I buy them because I expect to sell next year and benefit, this is a security, ”he explained assuming that the classification may change in the future.
“We have found that the applications of laundry tokens can change over time, both in the direction of acquiring the qualities of a security, and in the opposite direction,” added Clayton..