Cryptocurrency class action lawsuits: A new frontier
ICOs raised approximately $4 billion in 2017 alone, outpacing all venture capital raised in the United States. Because anyone with an idea for a project can gain financial backing without going through the formalities of an IPO, however, there are obvious chances for the public to be scammed, and we likely have only begun to see the beginning of class action lawsuits filed relating to blockchain-related companies or companies that participated in ICOs. Any company planning to conduct a token offering using an ICO should proceed with caution, and anyone looking to invest in a token offering should make sure it is conducted in compliance with applicable state and federal laws.
Bitcoin bouncing off $8,000 support after Google crypto ad ban
Bitcoin has been testing a monthly low at the $8,000 level and dipped as low as $7,920 since Google announced an update to its Financial services policy that will ban advertisements for cyptocurrency and related content. Separately, industry officials also said at a Congressional hearing Wednesday that U.S. regulators need to provide greater clarity.
What’s the difference between DApps and blockchain platforms?
If you are a potential investor in the blockchain space it can be difficult to differentiate between all the companies claiming to be the next ‘disruptor’ of an industry. The conflating of terms like blockchain technology, smart contracts and decentralised applications (DApps) can be confusing for many. Nonetheless, understanding what the project really entails, and whether it will actually be 'decentralized' remains a crucial part of any investor due diligence
SEC sweep might herald progress in the ICO market
The SEC sweep of ICOs does not mean that the regulator is taking issue with the concept of the Sale of Future Tokens (SAFT) per se, but rather with several specific issues that have become associated with the structure. David Weisberger explains important principles of securities laws that many SAFT launches and public ICOs potentially violate. Taken as a whole, adherence to these principles could create a better market for both entrepreneurs and investors, he argues.
Will regulations help or hurt cryptocurrency valuations in 2018?
If 2017 was the year of the ICO, 2018 will most likely become the year of cryptocurrency regulations. The first moves for a framework that will incorporate cryptocurrencies were made last year after financial regulators worldwide published statements on how they will treat initial coin offerings going forward.
A Blockchain Innovator’s Guide To IP Strategy, Protecting Innovation and Avoiding Infringement
Blockchain and Distributed Ledger Technology (DLT) promise to be a disruptive force in many areas. As a result, we are seeing a great deal of investment in this technology by industry and investors. In 2016, venture capital firms invested $392 million in the maturing technology and closed 75 deals. Furthermore, alternative forms of startup capital, such as Initial Coin Offerings (ICO), have recently eclipsed venture funding. These innovators are safeguarding their innovation with legal mechanisms for protecting IP, patents being the most significant among them. It is critical that participants in the blockchain ecosystem have a basic understanding of IP protection, strategy, and risk. This Primer is intended to provide such a foundation.
Swiss regulator publishes guidance around ICOs
In guidelines published in February, the Swiss Financial Market Supervisory Authority (FINMA) set out how it intends to apply financial market legislation in handling enquiries from ICO organisers. The guidelines also define the information FINMA requires to deal with such enquiries and the principles upon which it will base its responses, creating clarity for market participants.
ICOs in 2018: Increased Regulatory Scrutiny, And Alternatives to Traditional “Utility” Token ICOs
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 unregistered securities; and (ii) whether public statements made in connection with ICOs are fraudulent or materially misleading.
EY research: initial coin offerings (ICOs)
A lack of fundamental valuation and the due diligence process by potential investors is leading to extreme volatility of the initial coin offering (ICO) market, according to new research published by EY. The research also found that in some cases ICO investors are contributing capital at an average rate of over US$300, 000 per second.
The ICO Rollercoaster – The securities question as seen from Europe
It is difficult to know for sure where the ICO ride will stop, but Initial Coin Offerings are an important development on the global start-up and fundraising landscape. Ignore the ICO trend at your peril. But participate with caution. Not all of these rollercoasters have been built with the same standards or safety checks, or within the bounds of relevant regulations. But amid the wild ride, regulators have shown tolerance and an interest in encouraging innovation.
Tokenisation: Implications for the venture capital industry
This report by Mangrove Capital Partners will examine the potential of tokenisation and explain why ICOs could radically change how private companies raise capital. It will also provide an analysis of how this funding mechanism is being used, explore how ICOs could impact the venture capital operating model and examine the likely shape of a supporting regulatory framework.
Tokens of our affection: An introduction to ICOs and digital tokens under New Zealand law
This report provides a framework for participants in ICOs to consider in deciding whether New Zealand securities law may apply. The authors have done this by classifying tokens into four broad classes based on their terms, and then categorising these classes against the current New Zealand securities law framework.
China cracks down on cryptocurrency ICOs, while regulators across the globe issue warnings
The People’s Bank of China (PBoC), and six other government departments and ministries related to the Chinese economy, recently announced that Initial Coin Offerings (ICOs) are now illegal in the country. Referring to them as “illegal financial crimes,” the country’s central bank blames ICOs for “disrupting the financial markets” and calls for their immediate ification.
It’s all about liquidity in ICOs
A lack of liquidity will haunt the Initial Coin Offering market. The problem is that there are too many currencies. Without enough liquidity, we will see great participation by buyers with no support from market makers and no buyers for the cryptocoins that the ICO company wants to convert into flat cash.
SEC looks into token sales; ICOs subject to US security laws
The U.S. Securities and Exchange Commission (SEC) recently issued a report of its investigation on The DAO. The record-setting Initial Coin Offering (ICO) launched in June 2016, and quickly lost a third of its assets to a hacker. The purpose given for the report is "to stress that the U.S. federal securities law may apply to various activities, including distributed ledger technology.” The report cautions market participants that offer and sell digital assets, including through ICOs and ‘Token Sales’ are subject to the requirements of the federal securities law.
Initial Coin Offerings: What happens when a bubble cannot expand?
Initial Coin Offerings, or ICOs, have taken the fintech world by storm in the past few months. Despite the fact that these tokens do not usually confer any rights or claims against assets, as in the case of debt or equity securities, there are likely two reasons for the surge in ICO subscriptions. But the complete lack of investor protections and dubious quality of ICO issuers has drawn the attention of the SEC.
