Growth of ICO’s and Other Cryptocurrencies
We are still in the infancy of so-called initial coin offerings, but there is no lack in the demand for information about them. ICOs represent some interesting and innovative ways for firms to raise capital without the assistance of Wall Street. That should make traditional stock exchanges and investment banks nervous, or perhaps excited if they find ways to join that space. But ICOs are also laden with regulatory landmines. As several attorneys at CryptoCon pointed out, the US Securities and Exchange Commission considers ICO tokens as securities. Richard Levin, an attorney with Polsinelli, told the audience that SEC Chairman Jay Clayton has sent a serious and loud message to the market on tokens – they are securities and will be regulated as such. And that lends a whole new level of complexity and compliance to ICOs. Meanwhile, the Commodity Futures Trading Commission has viewed bitcoin as a commodity, which lends a whole new level of confusion to the market.
In short, regulation is another aspect of this marketplace that needs to be clarified and developed.
When panelists were asked where we are in the development of this space – be it cryptocurrencies, blockchain, ICO, investment funds and trading infrastructure, the answer usually was – we’re not even in the first inning.
Better start warming up.
Jim Kharouf is Director of Content Development at Gate 39 Media. He has been a journalist, editor and media specialist in the global derivatives markets since 1996.