During the US Securities and Exchange Commission (SEC) and Commodities and Futures Trading Commission (CFTC) senate hearing on February 6 2018, SEC chairman Jay Clayton emphasized that initial coin offerings (ICOs) will be met with tighter regulations, while true cryptocurrencies will be embraced with smart policies.
Hard for ICOs
At the senate hearing (as previously reported by Cointelegraph) Jay Clayton noted that every ICO token the SEC has seen so far is considered a security and explained that if a crypto-asset issued by a company increases in value over time depending on the performance of the company, it is considered a security:
“You can call it a coin, but if it functions like a security, it’s a security.”
Although most ICOs do not offer equity or a stake in their projects in order to exempt themselves from SEC regulations, if the SEC considers tokens that increase in value based on the performance of Blockchain projects featuring the tokens, then virtually every single…