The US Securities and Exchange Commission (SEC) implored sellers of security-like tokens to follow the law to its last letter, in a statement released by the commission’s chief Jay Clayton on Wednesday, June 6.
Clayton warned that SEC will not budge in its policy regarding token sales. “If you have an ICO or a stock, and you want to sell it in a private placement, follow the placement rules,” Clayton said.
Even so, he encouraged sellers to ‘see’ them, even saying that they would be “happy to help you [sellers] do that public offering.”
And what are SEC’s criteria for approving the token sales? Clayton explained:
“A token, a digital asset, where I give you my money and you go off and make a venture, and in return for giving you my money I say ‘you can get a return,’ that is a security and we regulate that.”
So far, it was the best explanation Clayton could provide now. Regarding whether tokens like Ether and XRP account for securities, Clayton was mum.
Last summer, SEC stated that ‘US federal laws may apply’ to Initial Coin Offerings (ICO), and that it would regulate “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.”
(Photo credit: Jay Clayton)