On Friday, Nov. 16, the SEC announced “settled charges against two companies that sold digital tokens in initial coin offerings (ICOs).” The agency explained that Carriereq Inc. (aka Airfox) and Paragon Coin Inc. both “consented to the orders without admitting or denying the findings,” elaborating:
These are the commission’s first cases imposing civil penalties solely for ICO securities offering registration violations. Both companies have agreed to return funds to harmed investors, register the tokens as securities, file periodic reports with the commission, and pay penalties.
The U.S. Securities and Exchange Commission (SEC) is expanded its crackdown on Initial Coin Offerings (ICOs), putting “hundreds” of projects at risk.
The agency is exerting pressure on many of ICO companies to settle their cases. In response, dozens of companies have quietly agreed to refund investor money and pay a fine. But many startups that have been subpoenaed say they are left in the dark struggling to satisfy the SEC’s demands, and are uncertain of how others are handling it, according to conversations with more than 15 industry sources as part of a joint investigation by Yahoo Finance and Decrypt.
Expect more of these headlines in the coming period. One of them will probably include the name of your favorite coin, your moon-lambo pick. And if the founders are not willing or not able to settle, pay the fines and re-adjust their legal position, that will be the end of that project.
It is a painful prediction, but it is almost inexorable. Just see what some of the leaders of crypto space think of the fate of majority of the market.
Ethereum co-founder Vitalik Buterin stated that 90 percent of initial coin offering (ICO) projects or ERC20 tokens launched on top of the Ethereum protocol will likely fail in the long-term.
“It is an established fact that ninety percent of startups fail. And it should also be an established fact that 90 percent of these ERC20s on CoinMarketCap are going to go to zero.”
Ted Rogers, the President of Xapo has made a similar claim about the rapidly declining cryptocurrency markets. He believes the ongoing ‘recession’ which has seen the overall market cap reduce by over $600 billion in 2018 alone, will see the end of 90% of all of the altcoins.
“90% of the digital currencies in the cryptocurrency market are poised to get wiped out while predicting an impending recession to take place in the altcoin space. Rogers says that this lapse will give crypto enthusiasts a huge opportunity to buy Bitcoins at a discounted rate.” – Ted Rogers
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