In the fiscal year which ended on September 30th, the US Securities and Exchange Commission (SEC) successfully closed more than a dozen cases involving malfeasance relating to the issuance of cryptocurrencies, specifically initial coin offerings (ICOs). The three biggest cases brought to trial in the period netted the authorities penalties in excess of 67 million US dollars (USD), a not insignificant amount given the sector’s infancy. SEC ICO prosecutions on this scale should, in theory, become a thing of the past as new regulatory measures are being put in place and fundraising for cryptocurrencies will probably hence forth take the more convention form of new products like securitised token offerings (STOs).
In its annual enforcement report, the SEC stated that;
“Given the explosion of ICOs over the last year, we have tried to pursue cases that deliver broad messages and have market impact beyond their own four corners”
Increased efforts to reign in the worst excesses of the emerging market has lead to a year where, “the Commission brought 20 stand alone cases, including those cases involving ICOs and digital assets.”
Whilst the dawn of 2019 will probably bring with it a litany of fresh legislation and regulation for the issuance and sale of decentralised digital currencies, there are still a plethora of outstanding cases on the book, which means that SEC ICO prosecutions will continue long into the new year;
“the Division has opened dozens of investigations involving ICOs and digital assets, many of which were ongoing at the close of FY 2018.”
So, whilst the Wild West may be just about over, it’s still going to be a while before the last of the cowboys has left town…