SEC: US Securities Laws 'May Apply' to Token Sales
The US Securities and Exchange Commission has recently issued a statement in which it is said that the offering and sale of digital tokens "are subject to the requirements of the federal securities law." The agency, in its statement, revealed that it had been investigating the issuance of tokens connected to The DAO, the Ethereum-based funding vehicle that collapsed dramatically last summer following an exploit of a flaw in its code.
According to the SEC, those "DAO tokens" constitute securities, though the agency said that it was not going to pursue any charges in connection with the project, but is releasing its finding "to caution the industry and market participants." The agency said:
"...the Commission deems it appropriate and in the public interest to issue this Report in order to stress that the U.S. federal
securities law may apply to various activities, including distributed ledger technology, depending on the particular facts and
circumstances, without regard to the form of the organization or technology used to effectuate a particular offer or sale."
As a result, many altcoins related to the ICO scenario have dropped in value, a scenario that has also been made possible
due to Bitcoin's upcoming UAHF and the concerns that it is causing investors.
Read more here and read the full SEC report here