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SEC Co-Director Of Enforcement To Deal With Illegal ICOs

Samantha Mitchell

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Stephanie Avakian, who is the co-director for enforcement at the SEC (Securities and Exchange Commission) in US has mentioned in her latest speech that the commission will be recommending more stringent enforcement for those who will not adhere to the registration requirements drafted for ICOs (initial coin offerings).

Valid Methods Of Raising Funds

Going by a draft of the speech that was published on the commission’s website Avakian put down the principles which the agency uses when it comes to making decisions relating to regulation and then went on to explain how the SEC will tackle the misconduct taking place in the ICO and Cryptocurrency sector.

Avakian went on to say that the uses of the Blockchain technology as well as the novelty that comes with ICOs seemed to be the main exciting factor to many people investing in the offerings. Nevertheless she noted that the overall excitement for ICOs most of the times overshadows the fact that some of them are more often than not investments that come with high risks mainly due to the fact that they do not have backing by any viable products, some have business models that are highly flawed as well as some are just outright frauds.

She added that the commission has been trying to be more conscious on ways of dealing with registration of ICOs that are legit. The SEC will be looking for more valid ways of raising funds while giving the investors the affirmation that there are ample protections in place to offer them security.

Dividends From Regulation Of ICO Space

Avakian noted that SEC has made several public statements in relation to the activities taking place within the ICO space referencing one in particular made last year in which the agency mentioned and discussed the increasing instances of ICOs being promoted by celebrities and other well-known individuals. She said that since the agency made the issue public there have been less and less ICOs which are endorsed by celebrities.

From an overall perspective, Avakian mentioned that the agency, specifically the Division of Enforcement, was seriously tackling any issues relating to ICOs and the Crypto sector pointing out that the work that has already been put into the sector, as well as other cyber-related concerns, have already paid off in dividends.

No Prohibition Of New Crypto Products

This recent speech made by the co-director for enforcement has been seen as closing what has been a very involving week for the agency in terms of matters the Cypto space. The regulatory commission this week announced that it will be opening an official review process which will be analyzing the ETF proposal made by VanEck and SolidX.

The proposal made by VanEck and SolidX had been making headlines as the proposed ETF will be holding an actual vitcoin in place of digital coins future contracts and will also be maintaining a safeguard for investors insuring them against the loss and theft of their digital currencies.

A few days ago Hester Peirce, an SEC commissioner, made the assertion that the federal government would not be prohibiting the introduction of more products into the crypto space because of what has been seen as Bitcoin’s weaknesses.

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