China Securities and Exchange Commission (SEC) has expanded its crackdown on some ICO products in the past few months, according to Yahoo Finance. The SEC issued a series of preliminary information-seeking subpoenas in early 2018, and the SEC is now subpoenaing companies that fail to ensure that their tokens are sold only to recognized investors. In response, dozens of companies have quietly agreed to refund investor funds and pay fines. But many companies that have been summoned say they are in trouble to meet the SEC's requirements and are not sure how other companies will handle the problem. It is reported that many of these sources came from employees of companies subpoenaed by the SEC or lawyers of these companies who requested anonymous information because the SEC restricted them from discussing the matter.
ICOs have raised more than $20 billion so far, but the ICO boom peaked in January 2008, according to the report. Concerns about the legality of target selling have had a chilling effect.
SEC regards most ICOs as a securities issue, and these companies fail to comply with it.
Reported that any U.S. company providing securities must register its products with the SEC or be eligible for exemption. During the boom of ICO, almost no one registered the issue of securities. Therefore, they must be exempted. The SEC exemptions include selling only to investors outside the United States, or only to recognized investors who have earned more than $200,000 a year in the past two years, or have a net worth of as little as $1 million.
Noted: news from Yahoo.