Clayton Says SEC Deepens Investigations Into Initial Coin Offerings Legal ViolationsSeptember 27, 2017 10:53 pm
The U.S. Securities and Exchange Commission has deepened its investigations into legal violations involved with initial coin offerings (ICOs), Bitcoin.com reported Wednesday.
Currently, the ICO market has raised $2.3 billion in blockchain-based funding with a large majority of tokens originating form the Ethereum network, the report said.
Past statements show the regulatory agency is seeking to prevent ICOs because they violate financial regulations and security mandates, the report said.
The SEC, an independent government agency, will investigate market manipulation schemes conducted with distributed ledger technology and regulatory violations tied to ICOs, a statement by the agency’s Cyber Unit said. In addition, the unit will probe misconduct perpetrated using the dark web and other “cyber-related threats.”
According to the latest SEC announcement, the unit was created months ago to implement “risk monitoring” initiatives previously outlined by agency Chairman Jay Clayton.
“Cyber-related threats and misconduct are among the greatest risks facing investors and the securities industry,” co-director of the SEC’s Enforcement Division, Stephanie Avakian said. “The Cyber Unit will enhance our ability to detect and investigate cyber threats through increasing expertise in an area of critical national importance.”
“I am not comfortable that the American investing public understands the substantial risks,” explained Clayton earlier this month.
“When Stephanie and Steve approached me with these initiatives,” he continued, “I endorsed them wholeheartedly. They reflect the division’s continual efforts to pursue new forms of misconduct while keeping a watchful eye out for our Main Street investors,” Clayton said.
– WN.com, Jack Durschlag