SEC Prohibits Speculating in “Blockchain” Word
January 24, 2018
SEC, one of the main bodies taking charge of securities and exchanges in USA, is going to monitor companies that use or add words “blockchain” and “crypto” into their names while not being involved into this industry.
“The SEC is looking closely at the disclosures of public companies that shift their business models to capitalize on the perceived promise of distributed ledger technology”, Jay Clayton noted.
Another problem worrying the SEC chairman is ICO. He considers tokens to be paper security with their components being out of the US legal framework.
Clayton raises concerns that lack of leverages for cryptocurrency and assets control may cause problems for small investors. In addition, lawyers provide inaccurate consulting on crypto market and ICOs to the clients. So they can also be subject to inspection soon.
As it was mentioned before, a great number of companies that have added “blockchain” or “crypto” to their names have also leveled up share price by hundreds per cent without any reason.