Washington, D.C. –The personal stance of Securities and Exchange Commission (SEC) Chairman Jay Clayton apropos of ICOs and crypto regulations has changed. This is what he expressed on a Princeton University forum on Thursday. The head of the federal agency responsible for the regulation and enforcement of laws pertaining to securities, options, and stock exchanges remarked that initial coin offerings or ICOs are not bad at all. In addition, he affirmed that the blockchain technology is auspicious for the financial industry’s future.
Chairman Clayton defended the regulatory measures pursued by his bureau, stating that ICOs and crypto regulations have a symbiotic relationship. He believes crypto regulations exist to develop virtual currencies. What the government official has been wary of is the widespread use of the blockchain technology by scammers. He clarified that more stringent steps would be taken by the SEC to combat these fraudsters and to further safeguard the public.
Affirming that ICOs are “absolutely not” duplicitous, Chairman Clayton’s statement is parallel to his notable remark in February, supporting that virtual currencies are a form of security. He offered his time to his Princeton audience, clarifying an evolving cryptocurrency word, “utility token,” comparing it to a “security token.” He illustrated the concept of a “utility token” by referring to a laundry token which he said is not a security because it’s for immediate use.
Alternatively, the concept of security comes by hypothetically having a set of 10 laundry tokens which he said he could use or sell in the future. Chairman Clayton confirmed that the concept of cryptocurrencies as security could change in time.
The SEC chairman believes that a lot of possibilities are on the horizon for the ever-expanding cryptocurrency industry, with countries possibly exploring sovereign digital currencies, while startups may develop diverse applications with the blockchain technology. It may come as a surprise that the picture painted by Chairman Clayton is contrary to what he made in December when he issued a statement as a concern for the public. For him, ICOs and crypto regulations were not on the same page because the former lack legality and protection for gullible and uninformed investors.