On April 3th, 2019 the US Securities and Exchange Commission staff released a “Statement on Framework for “Investment Contract” Analysis of Digital Assets” and the first no-action letter.
On April 25, 2019, the New York Office of the Attorney General (“OAG”) announced that it obtained a court order against the operators of Bitfinex demanding the online digital asset exchange turn over a plethora of important documents related to previous subpoenas the OAG issued to Bitfinex. The order’s accompanying petition alleges that Bitfinex “borrowed” funds from its affiliate, Tether, the … Read More
Blockchain technology, if you believe the hype, is going to revolutionize, well, everything. In an effort to bring a little sobriety to the Blockchain party, Forbes last year identified ten industries in which Blockchain genuinely seemed likely to disrupt the status quo. Banking, healthcare, and politics topped the list. Alas, Forbes failed to spot Blockchain’s actual highest and best use, … Read More
Despite the breathless excitement (and no small amount of weirdness) that surrounds blockchain technology, the predictions that it will revolutionize business remain just that – predictions. Still, it probably makes sense to prepare for a blockchain world. European Union officials are trying to do that.
In 2017, the Securities and Exchange Commission announced in the Report of Investigation on The DAO its view that digital tokens (or coins or certain cryptocurrencies) can be securities, subject to regulation by the SEC under the federal securities laws. Last month, it flexed its regulatory muscle. For the first time, the SEC imposed civil penalties—of $250,000 each—on two companies … Read More
Part 1 – Introduction On September 11, 2018, the Securities and Exchange Commission (SEC or the Commission) announced “public administrative and cease-and-desist proceedings” against Crypto Asset Management, LP (CAM) and Timothy Enneking (Enneking), the owner and manager of CAM. The ruling is notable as the Commission’s first order against a crypto-dominated investment fund, but also stands out because it provides … Read More
Cryptocurrency and blockchain technology are currently hot topics in the financial business world. Headlines regularly note trends and updates on virtual currency, its value, its regulation, and its future potential. As the digital currency market continues to mature, opportunities for related technologies emerge, the complexity of financial software increases, and new legal issues and applications of long-standing legal concepts surface. … Read More
Regulation of cryptocurrencies and other financial technology innovations varies greatly across jurisdictions. While some countries take a hands-off approach to encourage growth of new industries, others seek to control markets to protect investors or for political reasons. Predictably, as countries compete to land FinTech companies, many new businesses gravitate toward the less onerous compliance regimes, limited only by investors’ doubts … Read More
The Securities and Exchange Commission (SEC) issued an order last week declaring an ICO token to be a security and hence subject to corresponding regulation. Following on from its similar ruling with respect to The DAO on July 25th, the SEC held that Munchee Inc.’s efforts to promote its supposed “utility token” so emphasized the company’s planned efforts to spur … Read More
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