SEC Halts One of the Largest ICOs Ever

The U.S. SEC announced today that it had obtained a court order to halt and freeze the assets of what is likely one of the largest initial coin offerings ever. The complaint alleges that AriseBank used social media, a celebrity endorsement, and other wide dissemination tactics to raise what it claims to be $600 million of its $1 billion goal in just two months.  According to the SEC press release,

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TRO Granted in Bitconnect ICO Lawsuit

We previously reported how, in the Tezos litigation, the court denied a temporary restraining order that sought to enjoin the defendants from selling, transferring, converting, or otherwise disposing of any assets collected or derived from an ICO, holding that plaintiff had failed to show that he is likely to suffer irreparable harm in the absence of injunctive relief.  Today, in connection with the class action against BitConnect, (Paige v Bitconnect,

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ICO, Litigation, US

Coincheck Suffers Largest Cryptocurrency Hack

Last Friday, Coincheck, which calls itself the leading Bitcoin and cryptocurrency exchange in Asia, acknowledged that it had been hacked and that 500 million of its NEM tokens (valued at about $530 million) had been taken from Coincheck’s digital wallets.  This hack now surpasses the 2014 Mt. Gox hack as the largest one in history (to date).  Interestingly, Coincheck has identified and published 11 addresses where all of the stolen

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Vermont City To Use Blockchain For Land Records

Propy, a California-based blockchain startup, announced that it is partnering with the city of South Burlington, Vermont, to use blockchain technology to record real estate conveyance documents.  The goal will be to do away with hard copy registry altogether and enhance efficiency because, under the current system, it is necessary to drive to South Bulrington to do a title search.  Of course, carried to its ultimate conclusion, if land registry

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Real Estate, US

China May End ICO Ban

At a blockchain conference in Thailand, a Chinese official indicated that that the blanket ban on ICOs in China might be relaxed in 2018 in favor of other types of regulation.

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China, ICO

Further CFTC Enforcement

The CFTC disclosed today that, on January 16, in a case initially filed under seal, the CFTC sued and froze the assets of the creators of a supposed cryptocurrency called “My Big Coin” who allegedly took $6 million from unwitting buyers and used it to fund shopping sprees and pay off earlier investors.  My Big Coin Pay Inc. — a Nevada corporation whose product, the CFTC noted, sounded similar to

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CFTC, Cryptocurrency, Litigation, US

SEC Chairman Gets Tough With Lawyers

In a speech at the Securities Regulation Institute yesterday, U.S. SEC Chairman Clayton delivered some pretty blunt (and, according to the Commissioner, “stern”) words to lawyers and other professionals.  He said that market professionals need to act responsibly and hold themselves to a higher standard; in the realm of ICOs, he said, “they can do better.” Talking specifically about lawyers, he commented: First, and most disturbing to me, there are

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ICO, SEC, Securities, US

The Tax Implications of Cryptocurrencies

Among the many areas of law that will have to continue to evolve around cryptocurrencies is the tax law.  In the United States, as far back as 2014, the Internal Revenue Service issued Notice 2014-21 which clearly stated that virtual currency is treated as property for U.S. federal tax purposes.  That meant, among other things that: Wages paid to employees using virtual currency are taxable to the employee, must be

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Bitcoin, Cryptocurrency, Tax, US

CFTC Enforcement

We have previously discussed the position taken by the U.S. SEC with respect to cryptocurrencies. But the US Commodity Futures Trading Commission (CFTC) also has a role to play. On September 17, 2015, the CFTC brought its first cryptocurrency action against an unregistered Bitcoin trading platform.  Coinflip, Inc. d/b/a Derivabit (Coinflip) and its chief executive officer Francisco Riordan were charged operating a facility for the trading or processing of commodity options

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CFTC, Litigation, US

International Watchdog Issues ICO Warning

The International Organization of Securities Commissions (IOSCO) describes itself as the leading international policy forum for securities regulators, as being recognized as the global standard setter for securities regulation and as having a membership  that regulates more than 95% of the world’s securities markets in more than 115 jurisdictions.  It issued a media release today in which it warned that ICOs are highly speculative investments in which investors are putting

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