Categories: Ripple

Ripple CEO and ex-SEC Commissioner: ICOs are securities and must be regulated that way

Click here to view original web page at ambcrypto.com

Recently, Brad Garlinghouse appeared on a podcast with Joseph Grundfest, a former Commissioner of the United States Securities and Exchanges Commission [SEC]. Among other things, they spoke about Initial Coin Offerings [ICOs] and declaring them as securities.

A majority of ICOs offer tokens to investors in return for accepting funds in Ethereum [ETH] and Bitcoin [BTC]. While this itself brings the definition of the tokens to securities, the price of the token and the success of the investment depends on efforts carried out by those who accepted the funds.

The unregulated nature of the ICO markets has also led to a lot of scams and frauds coming to the forefront. Remarking on this, Grundfest stated:

“If these instruments are actually securities, they then have to comply with all of the regulations of the United States Securities and Exchange Commission and those are non-trivial.”

He further went on to speak about the process of registering a token as a security, finding exemptions from certain requirements, and other factors such as the restriction of sale on secondary markets. He stated that it added friction to the process, and that is the “last thing” that someone would want for quick and cheap transactions.

Ripple has also faced a number of lawsuits in recent times concerning XRP, where investors have begun suing the company over allegations of unregistered sale of securities. This was also addressed by Grundfest, where he stated:

“You’ve got people who have bought some of these instruments and have lost money taking their counterparties to court and arguing that what you sold me was a security. So what you have is a group of dissatisfied purchasers arguing that their crypto was security should have been registered and wasn’t.”

Garlinghouse provided statistics concerning the sale of ICOs in 2017, stating that it came up to above $3 billion, whereas in 2018 it has increased to $10 billion. Moreover, he stated:

“I would have guessed that would slow down in 2018 as regulators like the SEC interjected and more proactively called out frauds and scams. In many cases in fact I think they are securities and should be regulated that way this year.”

He further stated that he does not see the ICO boom slowing down “any time soon”, as regulators do not exhibit aggressive behaviour regarding them. He stated that they should, as it is a “little bit of a chaotic market”. Grundfast also agreed with Garlinghouse, stating that ICOs are the “most open and notorious violation of securities laws since the Code of Hammurabi”.

cinerama

Illuminati, Mason, Anonymous I'll never tell. I can tell you this, global power is shifting and those who have the new intelligence are working to acquire this new force. You matter naught except to yourself, therefore prepare for the least expected and make your place in the new world order.

Disqus Comments Loading...
Share
Published by
cinerama

Recent Posts

Bitcoin’s Bulls Now Have a Target of $13.2K, Monthly Chart Suggests

View Bitcoin charted an "inside bar" pattern last month, making $13,200 the level to beat for the bulls. A convincing… Read More

6 hours ago

Japan to Solarize Its Burgeoning Digital Economy, Expert Take

Society is now witnessing the implementation of digital currencies, artificial intelligence (AI) and blockchain technology worldwide. These new digital technologies… Read More

6 hours ago

Mass Media’s Phony Freakout Over Bernie’s WaPo Criticism Is Backfiring

Authored by Caitlin Johnstone, After days of ridiculous, hysterical garment rending by mass media talking heads in response to Senator… Read More

12 hours ago

Quadriga CX Dukes It Out with “Failing” Auditing Firms

Quadriga CX , the crypto exchange in Canada that lost all access to customers’ funds when its founder passed away… Read More

12 hours ago

The Bearish Trends That Continue to Strike Bitcoin

At press time, bitcoin – the granddaddy of all crypto – is once again down for the count. Bitcoin Is,… Read More

12 hours ago

Will Growing Interest from China Propel Bitcoin’s Price Higher?

Bitcoin (BTC) has incurred a significant amount of volatility as of late which was perpetuated yesterday by news regarding the… Read More

12 hours ago

This website uses cookies. We use these cookies to collect data about your interaction with our website for the purpose of continuously improving your experience with our site. For more information we encourage you to read our privacy policy.

Read More