2019 was a year of significant regulatory and legal developments in digital currency + blockchain. The SEC issued its most comprehensive guidance to date with its Framework for “Investment Contract” Analysis of Digital Assets, followed that up with three “no action” letters for projects that in its view complied with…
On July 26, 2019, the Internal Revenue Service (“IRS”) published a release announcing that it has begun to send notices to virtual currency traders that potentially failed to: (i) report income and pay the resulting tax from virtual currency transactions; or (ii) properly report their virtual currency transactions. In its…
The Securities and Exchange Commission (SEC) finally provided some good news, and guidance, regarding permissible token sales. On June 14, 2018, William Hinman, Director of the SEC Division of Corporation Finance, speaking at the Yahoo Finance All Markets Summit: Crypto, shared remarks that filled in some gaps surrounding the security…
The Securities and Exchange Commission (SEC) last week sued Longfin Corp., a financial technology company that recently entered the cryptocurrency space, as well as Longfin’s CEO and three others affiliated with the company. The complaint, filed in federal court in Manhattan, was unsealed on April 6, 2018, when the SEC…
As originally published by Brave New Coin, January 19, 2018. As we transition from 2017 into 2018, there has been an increase in SEC and state regulator activity in the area of Initial Coin Offerings (“ICOs”), as the agencies seek to determine (i) whether certain ICOs constitute a sale of…
As published in Bloomberg BNA’s Securities Regulation & Law Report, December 18, 2017 An initial coin offering (“ICO”) does not happen on its own. Rather, there are companies and individuals that assist in successful token sales. These can include ICO consultants, marketing firms, board members, partners at private equity and…
On December 11, 2017, the U.S. Securities and Exchange Commission (SEC) issued a cease-and-desist order to Munchee Inc. (Munchee), a company that was in the process of a $15 million initial coin offering (ICO), for selling unlicensed securities. The SEC found that the ICO targeted investors, with the expectation of…
During a speech on November 8th at the 49th Annual Institute on Securities Regulation, Securities and Exchange Commission Chairman Jay Clayton discussed initial coin offerings, stating that he had “yet to see an ICO that doesn’t have a sufficient number of hallmarks of a security,” seeming to indicate increased SEC…
On September 25, 2017, the Securities and Exchange Commission (SEC) announced the launch of its new Cyber Unit. Drawing on the existing cyber experience of the SEC’s Enforcement Division, and including personnel from around the country, the Cyber Unit will target cyber-related misconduct in the following areas identified by the…
Protostarr, a block-chain based startup, has shut down its decentralized application and refunded its initial coin offering (ICO) participants following a request for information from the U.S. Securities and Exchange Commission (SEC). According to the company, on August 24, the SEC contacted Protostarr and asked the company to “volunteer a…