One of the most opinionated personalities in the cryptocurrency community, John McAfee, has argued with US Securities and Exchange Commission’s (SEC) chairman over the labeling of initial coin offering (ICO) tokens as securities. The tech activist and internet security expert swore to argue the SEC’s pronouncement via his Twitter account.
McAfee launched many disputes on social media ever since Jay Clayton, Securities and Exchange Commission (SEC) chairman, declared that he recognizes most ICO tokens to be securities.
Clayton said in an interview earlier in June that all cryptocurrencies were securities except for digital currencies like Bitcoin. At an SEC public forum on June 14, Clayton reemphasized the same position, stating:
“Much of what I have seen in the ICO or token or ICO space, is a security offering. I don’t know how much [clearer] I can be about it.”
Although it is still unclear how the ex-internet security magnate expects to prosecute his campaign versus the SEC. His Twitter tirades on the matter have focused on public debates with the SEC, throwing the gauntlet down to Clayton.
This specific argument originates from the failure to accurately define what cryptocurrency tokens are. According to the SEC, tokens like Bitcoin — digital currencies that are substituted for fiat — are not securities.
Over 1,600 cryptocurrencies, nonetheless, are not fiat substitutes. They are tokens that grant access to a digital platform. However, the SEC objects — instead claiming that these tokens raise capital via a public sale and can be sold on a secondary market, thus classifying them as securities.
(Image Source: Photo: San Francisco Chronicles | Todd J. Van Emst, Associated Press)