SEC Commissioner Takes Less Rigid Position on ICOs and does not Favor Sandboxes

SEC-watchers regularly quote Chairman Clayton’s statement at a February 2018 Senate hearing (“I believe every ICO I’ve seen is a security”) as evidence of the SEC’s strict view of ICOs.  During a speech yesterday at the Medici Conference, SEC Commissioner Hester Pierce took a different tact.  Asking, rhetorically, whether ICOs offerings are securities that have to be registered or qualify for an exemption, she said that the answer should be

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ICO, SEC, US

U.S. Court Denies Injunction Request Against Alibaba Cryptocurrency Creator for Lack of Personal Jurisdiction

Defendants in this case created a cryptocurrency called Alibabacoin and used the Alibaba name on its alibabacoinwallet.com websites, Facebook page, and phone applications.  Online retailer Alibaba sued for infringement of its federally registered “Alibaba” mark.  Despite finding it that there was subject matter jurisdiction under the Lanham Act (the US federal trademark statute), the court denied Alibaba’s motion for a preliminary injunction without prejudice to renewal upon a showing of

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Cryptocurrency, Litigation, SEC, US

SEC Will Take Additional Time to Consider Approval of Bitcoin-Related ETF

In January, the New York Stock Exchange asked the Securities and Exchange Commission to allow it to list five bitcoin-related exchange-traded funds (ETFs) on one of its markets, according to an SEC filing.  Last week, the SEC issued an order indicating that it was going to take additional time to consider the application.  The SEC is soliciting written comments from the public to address 13 questions, including commenters’ views on

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Cryptocurrency, SEC, US

SEC Approach Remains Cautious

The U.S. SEC’s continued effort to try to walk a tightrope regarding regulation of ICO’s was on display again yesterday.  Chairman Clayton has famously said that “I have yet to see an ICO that doesn’t have a sufficient number of hallmarks of a security.”  Yet, during testimony yesterday,  William Hinman, the director of the SEC’s Division of Corporation Finance, stated his division is “striving for a balanced approach,” and repeated

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ICO, SEC, US

Blockchain vs GDPR: Technology Meets Regulation (Again!)

Unless you’ve been living under a series of highly distributed rocks, you’ll be aware that blockchain (or at least the group of technologies known as Distributed Ledger Technologies or DLTs) is causing a huge stir in the tech world.  Almost daily, we see the launch of potentially game-changing new cryptocurrencies or announcement from major corporations of significant new DLT trials or implementations. However, another major force shaping the digital world

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Uncategorized

US CFTC Bring New Enforcement Action In Scheme Involving Binary Options and Cryptocurrency

The U.S. Commodity Futures Trading Commission (CFTC) announced the filing of a Complaint in the U.S. District Court for the Eastern District of New York charging Defendants Blake Harrison Kantor, who frequently uses the alias Bill Gordon, and Nathan Mullins, and the entities Blue Bit Banc, Blue Bit Analytics, Ltd. with operating a  fraudulent scheme involving binary options and a virtual currency known as ATM Coin.  The district court, on

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CFTC, Cryptocurrency, US

New York Launches Inquiry Into Cryptocurrency “Exchanges”

Today, New York’s Attorney General launched the Virtual Markets Integrity Initiative, a fact-finding inquiry into the policies and practices of platforms used by consumers to trade cryptocurrencies.  The Attorney General’s office sent letters to thirteen major virtual currency trading platforms requesting key information on their operations, internal controls, and safeguards to protect customer assets. The letters were sent to: (1) Coinbase, Inc. (GDAX); (2) Gemini Trust Company; (3) bitFlyer USA,

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Cryptocurrency, New York

Hong Kong Securities Watchdog Warns that Many ICOs May Be Frauds

In a speech on new technologies on Friday, Hong Kong Securities and Futures Commission (SFC) deputy chief Julia Leung reiterated previous concerns of risks associated with ICOs.  She acknowledged that innovative technologies such as blockchain have the potential to improve efficiency and financial inclusion, but warned “that does not entitle anyone to conduct fundraising from the public in violation of securities law.”  More frankly, she noted that ICOs: [A]re dubious,

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Hong Kong, ICO

England’s FCA Warns Cryptocurrency Derivatives Likely to be Regulated

To date, the Financial Conduct Authority (FCA), the UK financial services regulator has made clear (via its Feedback statement on DLT) that cryptocurrencies are not currently regulated, provided they are not part of any other regulated products or services. Nonetheless it has published a series of consumer warnings  – on ICOs and the risks of investing in cryptocurrency CFDs. On April 6, 2018 the FCA issued a further statement warning

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Cryptocurrency, FCA, UK

Texas Regulator Finds Widespread Fraud in Cryptocurrency Offerings

The Texas State Securities Board issued a report summarizing its a four-week investigation of securities offerings tied to virtual currencies.  They opened 32 investigations in the period commencing December 18, 2017.  Among the findings: No promoters were registered to sell securities in Texas, a violation of the Texas Securities Act; 30 promoters were broadly using websites, social media, and onlineadvertising to market to Texans; Seven promoters were offering securities tied

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Cryptocurrency, ICO, US

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