The Recent News On SEC Appointing A New Cryptocurrency Overseer

Cryptocurrency Regulation And SEC

The US Securities and Exchange Commission has long been known as a hard-to-read regulatory body by members of the cryptocurrency community in the United States. It has risen to become some of the most popular areas of investment as the sec has hurried to keep pace with the growing interest among both new and seasoned investors. The SEC has hereby made decisions along with some in the cryptocurrency world feeling that it could hinder the decentralized digital asset space. In this context, the Coindesk reports that it is one of the SEC’s top officials on cryptocurrency as the digital token sales have been named thereby to anew senior advisory position with the implication that the regulatory body’s relationship has with the cryptocurrency world that is more broadly remain unclear. 

Valerie SzczepanikIn TheNew Role

According to Valerie Szczepanik who was formerly the leader of the SEC’s distributed ledger working group as it now acts as associate director of the Division of Corporation Finance as well as senior advisor for digital assets as well as innovation according to the report. Szczepanik further notes that in his new role, he coordinates efforts across all SEC Divisions and Offices thereby regarding the application of US securities as emerging digital asset technologies and innovations thereby including initial coin offerings and cryptocurrencies. 

Therefor indicating in a statement Szczepanik commented that she is excited to take on the new role which is in support of the SEC’s efforts as it is addressing digital assets and innovation as it surely carries out the mission thereby to facilitate capital formation, as also promoting fair, orderly and the efficient markets and protect the investors particularly Main Street investors. 

The Shift InSEC Focus?

Much of the SEC’s work up to this point is in the digital currency space focused on alleged scams and frauds that are particularly in the area of initial coin offerings and additionally there comes the agency that has sought to determine what it believes to be the best practices regulating a space conceived to be autonomous and free of government intervention. 

As Szczepanik aims to continue these efforts its unclear as a matter of primary focus or if the SEC will explore those that are new areas of government involvement in cryptocurrencies, as well as related companies, the SEC Chairman Jay Clayton, had suggested that digital currencies have thereby represented a dynamic area where that has both promise and risk. Thereafter adding that Val comes to be the right person coordinating their efforts going forward. 

Advantages and Disadvantages of Initial Coin Offerings (ICO)

Advantages 

In the case of IPO, the investor receives shares of stock in a company thereby in exchange for their investment. While there are no shares per se, the ICO comes with companies raising funds via ICO providing a blockchain equivalent to a share which is a cryptocurrency token. Investors pay in a popular existing token like bitcoin or ether in most cases as well as receive a commensurate number of new tokens in exchange. 

To create these tokens, it worth noting that it is easy for a company to launch an ICO as the online services allow for the generation of cryptocurrency tokens in a matter of seconds with investors keeping it in mind while they consider the differences between shares ad tokens as the token does not have any intrinsic value or legal guarantees with ICO managers generating tokens according to the terms of the ICO, receive them as well as distribute them according to their plan by transferring them to individual investors. 

In an ICO operation early on these investors are usually motivated to buy tokens in the hope of succeeding in the plan after it launches. It is being viewed that if it happens, the value of the tokens purchased during the ICO is sure to climb above the price set during the ICO as they will achieve overall gains. The potential for very high returns is the primary benefit of an ICO. 

Disadvantages

ICO s have also brought along challenges, risks, and unforeseen opportunities as they have come to the forefront in the cryptocurrency and blockchain industries. Therefore, many investors are buying into ICOs with hopes of quick and powerful returns on their investments with the most successful ICOs over the past several years comes to be the source of this hope as they have produced tremendous returns indeed and investor enthusiasm has also led people astray, however.

ICOs are rife with fraud and scam artists looking to prey on overzealous and poorly informed investors as they are largely unregulated since they are not regulated by the financial authorities similar to the SSEC, where funds come to be lost due to fraud or incompetence which may never be recovered.

In this case, there is no guarantee as to what the investor won’t be on the losing end of a scam when investing in ICOs helping avoid ICO scams where they should primarily project developers should make sure that they clearly define what their goals are as successful ICOs which are typically straightforward, understandable, whitepapers with clear, concise goals. 

The Final Thoughts On ICO

Also, know the developers as investors should strive for 100% transparency from a company launching an ICO.

Thereafter it is necessary to look for legal terms and conditions set for the ICO as the outside regulators for cryptocurrency generally do not oversee this space which is up to an investor henceforth to ensure any of the ICO which is legitimate.