The 'No Action' Relief from SEC

[CryptoBry]

The proliferation of ICOs especially in the year 2017 resulted into some of them being accused of offering securities instead of just the usual tokens. There had been projects which were served cases by SEC and many of them prayed that SEC will instead formulate something that can be acceptable by both sides.

Hence, SEC has the 'no relief' action to give chance to those accused of dealing with securities but later on proved that they are actually not based on the things they achieved so far with their corresponding projects or platforms.

I am sure that many projects got some sigh of relief with this development. With securities now clearly defined as opposed to just offering tokens, let's see if there will be new projects originating or based in USA this time. 

[davis196]

So what's the difference between securities and tokens?
The securities are backed up by some other asset with a stable price?This is just my assumption.
Anyway,nobody cares about the SEC and how they deal with ICOs.

[jvdp]

So what's the difference between securities and tokens?
The securities are backed up by some other asset with a stable price?This is just my assumption.
Anyway,nobody cares about the SEC and how they deal with ICOs.

Really sad to see your knowledge bro even I am not a scholar or something but people whoever caught by SEC, they paid in millions and some are in prison. Always we need the recognization from the SEC commission.
That is the reason many ICO exclude the American and some European countries for ICO investment in their site and whitepaper. Because of such move from SEC only we are seeing IEO emergence in the marketplace.

[squatter]

So what's the difference between securities and tokens?

A token is just a unit issued on a blockchain. It could be a stablecoin like USDT ERC-20 tokens, a security token, a utility token, etc. It may or may not be a security, depending on what the "Howey Test" says:

Under the Howey Test, a transaction is an investment contract if:

-It is an investment of money
-There is an expectation of profits from the investment
-The investment of money is in a common enterprise
-Any profit comes from the efforts of a promoter or third party

The SEC has come out and said that most ICOs were securities offerings. If the ICO team advertises the offering as a profit-making opportunity, then its definitely a security.
 

Anyway,nobody cares about the SEC and how they deal with ICOs.

The SEC has halted ICOs, charged founders with crimes, frozen their bank accounts, etc. People running token offerings are very careful these days about how they deal with US investors for good reason.

[Theb]

I just don't get why the SEC are acting dumb on a lot of ICOs classifying them mostly as security tokens when these security tokens mostly share the same characteristics as what stocks of companies do for its shareholders. It's like their only using it as an excuse so that ICOs won't be prevalent in the US market. Now they have this kind of "solution" for wrongly classified tokens as if they needed to do this in the first place, all things the SEC is doing are all pointing out to delaying tactics which is getting pretty obvious now.

[avikz]

The proliferation of ICOs especially in the year 2017 resulted into some of them being accused of offering securities instead of just the usual tokens. There had been projects which were served cases by SEC and many of them prayed that SEC will instead formulate something that can be acceptable by both sides.

Hence, SEC has the 'no relief' action to give chance to those accused of dealing with securities but later on proved that they are actually not based on the things they achieved so far with their corresponding projects or platforms.

I am sure that many projects got some sigh of relief with this development. With securities now clearly defined as opposed to just offering tokens, let's see if there will be new projects originating or based in USA this time. 

A good development from US, however, I just hope that frauds will stay below the belt. SEC had to step in because there were a lot of frauds happening and the framework was not clearly defined for ICOs. Now that ICOs have found a new way of raising funds through IEO, the number of frauds are expected to decrease. I just hope it remains the same way, no matter it is a security or a token offering!

[dothebeats]

The US had been pretty much the bane of ICO operators and founders due to strict regulations and a rather intertwined and vague definition of securities and tokens relating to cryptocurrencies. As such, very little ICO/projects popped out ever since the scene started to take a beating from the SEC in 2017. Well we can't really blame the regulators though, as they seem to be having a hard time figuring out which is which, and understandable to do the bans and whatnot in order to prevent big scams or yet another Bitconnect 2.0.

Anyway, it's not just the US having a hard time dealing with ICOs/IEOs/whatever at this point in time. With the 'no relief' action made by the SEC, legitimate projects will have the chance to prove themselves and prosper, with most of the scams hopefully being washed out after the grace period.

[Kemarit]

As per the article:

“Digital assets may evolve into an instrument that no longer needs to be regulated as such,” he said.

In his remarks, Hinman noted that the SEC’s actions to date have been conducted in accordance with its existing statutes and rules.

“I mention this to show the flexibility of the regulatory framework we are working under,” he said.

I think this is a very significant statement coming from the SEC. But it going to be a long battle if indeed US citizens would be allow to invest on ICO/IEO. We really need to see a clear cut regulations coming from them. So although this is very welcoming news indeed, but US citizens should always be careful though.

[magneto]

The proliferation of ICOs especially in the year 2017 resulted into some of them being accused of offering securities instead of just the usual tokens. There had been projects which were served cases by SEC and many of them prayed that SEC will instead formulate something that can be acceptable by both sides.

Hence, SEC has the 'no relief' action to give chance to those accused of dealing with securities but later on proved that they are actually not based on the things they achieved so far with their corresponding projects or platforms.

I am sure that many projects got some sigh of relief with this development. With securities now clearly defined as opposed to just offering tokens, let's see if there will be new projects originating or based in USA this time. 

The fact that they seem interested in promoting growth in this industry by not driving out all of the businesses into extinction is a good sign.

I'm not sure about how useful/effective this no action relief really is, though. Many projects that are not based in the US will not have access to it most probably, and you'd have to most likely go through complex procedures in order to even get a chance of getting one.

After all, the SEC's jurisdiction is only the US, and in the rest of the world, there is still ambiguity in terms of the definition of tokens, whether they count as securities, etc.

[Harlot]

It's like their way of saying that they made a mistake on identifying them as STO by not saying anything at all. They shouldn't really have this kind of process in the first place for wrongly classified ICOs as its just adding further inconvenience for token developers in that country. They'll just be adding more expenses with all the procedures needed to be re-identified as another kind of token.

[squatter]

I'm not sure about how useful/effective this no action relief really is, though. Many projects that are not based in the US will not have access to it most probably, and you'd have to most likely go through complex procedures in order to even get a chance of getting one.

After all, the SEC's jurisdiction is only the US, and in the rest of the world, there is still ambiguity in terms of the definition of tokens, whether they count as securities, etc.

If tokens are offered to US persons (located inside or outside the US), the SEC has jurisdiction -- at least in their eyes. Issuers in foreign jurisdictions therefore need to be very careful to comply with Regulation S if they want to avoid problems with the SEC. There were lots of ICOs who probably did not properly comply. This is good news for them.

[timerland]

The proliferation of ICOs especially in the year 2017 resulted into some of them being accused of offering securities instead of just the usual tokens. There had been projects which were served cases by SEC and many of them prayed that SEC will instead formulate something that can be acceptable by both sides.

Hence, SEC has the 'no relief' action to give chance to those accused of dealing with securities but later on proved that they are actually not based on the things they achieved so far with their corresponding projects or platforms.

I am sure that many projects got some sigh of relief with this development. With securities now clearly defined as opposed to just offering tokens, let's see if there will be new projects originating or based in USA this time. 

These aren't really major developments. SEC has been really handing out settlements like this without prosecuting the firm of its wrongdoing, in exchange for cooperation or certain conditions for many decades.

But it is a welcome sight in my opinion, because they are recognizing the fact that simply barring everyone entry into this crypto industry by setting absurdly high regulatory standards simply is not going to work.

I think they are recognizing that a greater level of collaboration between the firms already established that may be vulnerable to securities laws, and the regulatory authority, need to be had to achieve effective regulation, which is great. But as to how they actually approach cases and hand out these concessions is yet to be seen.

[josephdd1]

I'm not sure about how useful/effective this no action relief really is, though. Many projects that are not based in the US will not have access to it most probably, and you'd have to most likely go through complex procedures in order to even get a chance of getting one.

After all, the SEC's jurisdiction is only the US, and in the rest of the world, there is still ambiguity in terms of the definition of tokens, whether they count as securities, etc.

If tokens are offered to US persons (located inside or outside the US), the SEC has jurisdiction -- at least in their eyes. Issuers in foreign jurisdictions therefore need to be very careful to comply with Regulation S if they want to avoid problems with the SEC. There were lots of ICOs who probably did not properly comply. This is good news for them.

The thing is SEC is known to poke their noses in foreign affairs as well, especially in the matters involving the G7 and anywhere where IMF funnels money into. And that is pretty much everywhere. Just take Romania for example.

So what's the difference between securities and tokens?
The securities are backed up by some other asset with a stable price?This is just my assumption.
Anyway,nobody cares about the SEC and how they deal with ICOs.

That may be your interpretation but ask the millions of people in america, they care about what SEC says otherwise they are being held back from investing.

[bozo333]

After SEC regulation has been implemented many scam ICOs are banned and many countries came with regulation on investing over cryptocurrencies on exchanges.

[buwaytress]

Wasn't this old news reported from December already?

It appears already a few planned offerings are looking for this new route now, if what I've been hearing in the news is anything to go by. I think the SEC has always been this understanding, just people weren't patient enough to hear their side properly (same as FATF). Slow they may be, but not stupid. Not hasty. Kind of the same impatience people were showing sometimes with Bitcoin haha!

Anyway, seems Bitmain itself thinks it's benefitting from this confirmation of relaxation for its resurrected IPO.