Jay Clayton Urge ICO Firms to Abide by the Rules to Avert Penalties

In an interview with CNBC correspondent yesterday, November 26, the chairman of the U.S Securities and Exchange Commission (SEC), Jay Clayton, said that the commission’s decision about unregistered Initial Coin Offering (ICO) has not changed.

The SEC chief said the regulators’ decision to ban two ICO firms earlier this month is justified since the firms’ did not abide by the commission’s instruction to register ICO tokens as securities.

“To the extent that an ICO is being conducted offshore or pursuant to a private placement exemption, fine; to the extent that you’ve conducted a public offering in an ICO, it’s non-compliant,” he told CNBC.

He reiterated that crypto firms should do well and comply with the commission’s rules, to avoid severe penalty.

Bitcoin Not A Security – SEC Head

On the general crypto markets, Clayton stated that Bitcoin, unlike other cryptocurrencies, is not regarded as security. Every other thing aside from Bitcoin, however, still has to come under scrutiny as to whether they are “securities” he suggested.   

“I think we’ve been clear that Bitcoin isn’t a security, but many of the ICOs that you see and talk about – they are securities,” Clayton added.

It can be recalled that early this month, two crypto firms CarrierEQ Inc. (Airfox) and Paragon Coin Inc., were hit with civil penalties for not registering their token sales last year. The SEC had earlier warned that ICOs could be dealt with if found guilty of conducting unregistered securities offerings.

The firms were later forced to repay millions of dollars to harmed investors, and fines imposed by the SEC.

Clayton Keeps Mute on Other Crypto-related Topics

Other questions concerning the current situation in the crypto space as well as a possible Bitcoin ETF approval, but Clayton did not give a specific response to these questions, as he chose not to comment in most cases.  

“I’m not going to comment on timing or anything like that, but we’ve been clear on some of the issues that are of concern to us,” he said.

What the next line of action by the commission will be is therefore still uncertain at this point, even though it already looks like it will not be favorable for ICOs targeting the U.S audience.