The US SEC Addresses and Reaffirms Guidelines on ICOs
By Luke Flowers – Crypto Investor
The Securities & Exchange Commission (SEC) of the United States has re-addressed guidelines on Initial Coin Offerings (ICOs) as plans to establish the space continues. The SEC has included a section on their website to focus on the five aspects of ICOs deemed crucial.
Though the content has been available since March, the SEC is re-drawing attention to the risks involved and the SEC’s stance on these. Any individual seeking to buy crypto for an ICO could potentially be investing in a security from the issuer. The publication is one of the most available on the SEC’s website in the form of a user guide; making it highly accessible and easy to read.
While ICOs are on the rise, regulation is still falling behind as the SEC and Commodity Futures Trading Commission continue to discuss their roles. Regulation has been soft as to not stifle innovation but users buying Bitcoin have been unaware of guidelines to help protect their investment.
The SEC state on this guide that, ‘while these digital assets and the technology behind them may present a new and efficient means for carrying out financial transactions, they also bring increased risk of fraud and manipulation because the markets for these assets are less regulated than traditional capital markets.” Whilst these markets remain unregulated, there’s inherent risks involved with buying crypto to invest in an ICO.
Regulation of ICOs will continue as the SEC and other bodies establish framework to guide those that sell and buy cryptocurrency assets. ICOs are not attracting as much attention or capital as they were this time last year as the market has declined significantly. There are still projects successfully conducting ICOs to raise funds.
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