What People Are Saying: Security Tokens & Regulations
What People Are Saying: Security Tokens & Regulations
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Crypto Monday Transcript


Tobin McComas:

The regulatory environment's been changing feels like by the hour, and it's really about investor protection. And our venue will be a platform, which will allow for secondary trading of those security tokens. So we think it's another great avenue for investors to participate in companies, that are doing some really great things with the blockchain technology.

Chi-Ru Jou:

Right now the problem is that different regulators are all stepping in, and claiming jurisdiction. We have SEC does CFTC, we have FINCEN all claiming jurisdiction. So we may be headed toward a lot of litigation in the future.

Ian Olito:

Wyoming just passed five bills. I don't know if you're familiar with what happened in Wyoming. They're very pro blockchain, and crypto, and they just did this a couple of weeks ago. So the environment's changing every day. We don't know what the SEC's going to do. I mean they're looking at companies right now so you gotta be careful, and that's what we're trying to do.

James Galitsis:

I think regulation should just begin, and end in terms of the security token offering, or in ICO. I believe cryptocurrency is a very, very unique asset, that traditional securities, or commodities laws don't necessarily apply. But I do believe that anytime that you raise outside capital like an ICO, or a security token offering, or a TG of some sort, I really do believe that you need regulatory bodies to oversee because these are funds that are given by investors, and majority of them they're not big investors, they're small investors. And we have to make sure that the money's being utilized in the proper way, that you don't just raise money, and then these people walk away. So it's very important that regulatory bodies come in, in terms of the STO the ICO space.

James Haft:

There's a need from the government to make new products look like the old products. So what we're trying to do right now is the government seems to be trying to shoehorn this new development in the capital markets into the old framework of stocks, and this is probably something you can anticipate as happening. We hope it's a short-term phenomenon, and we hope that the ability, and the added excitement of the tokens, and the flexibility of the democratization of securitization that the tokens offer is able to shine through over the long-term.

And in the short-term that the regulatory environment that's forcing the tokens to look more like stocks, and to fit into our existing securities structures we're hoping that, that doesn't kill the market because this is right now what we're going through is the fastest, and biggest redistribution, and creation of wealth in humankind. And it's very important for job creation, and for wealth creation, and for the United States to maintain its position in the global capital markets, that we figure out how to support this new asset class.

Juan Hernandez:

I think a lot of what we're hearing is just a reminder that hey, there are rules out there for this. Again I keep going back to the JOBS Act of 20 12. The JOBS Act really set the framework for what's happening out, what's allowed out there. And again it's all done in the name of investor protection. None of it's in the name of stifling innovation, and killing this great energy that's out there. It's really just about protecting people like you, and me, protecting that little old lady who is investing her retirement money into these types of deals, and really just providing a safe, and even playing field for all the participants out there. So for us we think there's certainly coming out with guidance around reminding people that there are rules out there for this sort of stuff. We're fans of light regulation, we're fans of investor protection, and so far everything we've heard has been in support of our broader, the broader movement we see playing out.

Calvin Bradley:

For us compliance is absolutely key. It's one of our core pillars. But we're directly working with the DFS, and making sure that they set the tone, and they set the frameworks, they set the groundworks for us to be a successful business. So we're very much in line with how do we work with government, how do we work with not-for-profits, how do work with regular businesses, and how do we build that ecosystem so that this technology is actually used the way that it's meant to, and the way that it's effective.

Chi-Ru Jou:

A lot of insurers are moving out of the U.S. market. But we're seeing the most popular response is to do an offering under an exemption to the SEC registration rules under Regulation D to accredited investors. And that a lot of insurers are following up with what's called the airdrop, which is a free token giveaway. But we wanna caution insurers that the airdrop is not without its risks its SEC risks. So we would say that the airdrop needs to also be offered under an exemption as well.

Dan Raykhman:

I'm hoping that the regulators will be able to understand what project is really trying to do something new, and innovating, innovative, something that has benefits for the end user versus project where people just trying to raise money, and really have no interest in helping the market, or helping the investors.

Calvin Bradley:

The way the trend is going in the industry I think securitization on assets is a massive, massive leap forward. And I think the credibility that, that's gonna give to companies who are pushing the boundary there is gonna be amazing for the space.

Chi-Ru Jou:

People are scared of the utility token offerings right now. I'm anticipating that one of the larger blockchain companies will eventually challenge the SEC on the definition of a utility token, and we can see that move up to an appeal court hopefully will be resolved in the future.

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