Securities and Exchange Commission (SEC) chairman Jay Clayton still has not clarified whether initial coin offerings (ICOs) are securities sales.
In a letter addressed to Clayton, a dozen lawmakers claim that “current uncertainty surrounding the treatment of offers and sales of digital tokens is hindering innovation in the United States and will ultimately drive business elsewhere. We believe the SEC could do more to clarify its position.”
Individuals from blockchain startups, cryptocurrency exchanges and venture capital funds have expressed their concern around this vague area of law, emphasizing the need for a definitive legislation surrounding token sales.
The SEC first needs to clarify whether and when token sales should be classified as regulated “investment contracts,” whether a token initially sold as a security can later become a non-security, and what tools are available for the “SEC to offer more concrete guidance to innovators.”
The letter does not provide a specific timeframe, acknowledging that “such guidance will, reasonably, take time, caution and deep consideration.” The letter says the questions are aimed at providing formal guidance in the long-term.