The cryptocurrency market has experienced tremendous growth this year, reaching a total market cap of more than 150 billion dollars. This explosive growth has captured the attention of governments and regulatory agencies around the globe.
Until recently, there was very little interest from governments in cryptocurrency, however with ICOs raising millions of dollars in mere minutes, they have been forced to take notice. Up until this point the cryptocurrency markets and ICOs have operated virtually free from regulation, however that is all about to change.
SEC Tokens Ruling
On July 25th, the SEC made a ruling on the DAO token sale concluding “that tokens offered and sold by a "virtual" organization known as "The DAO" were securities and therefore subject to the federal securities laws.” DAO is a decentralized autonomous organization, a new business model that doesn’t require a CEO or centralized hierarchy.
In this ruling, the SEC made it abundantly clear that “U.S. Securities Laws May Apply to Offers, Sales, and Trading of Interests in Virtual Organizations”. The SEC’s ruling was a warning for the entire industry, designed “to caution the industry and market participants: the federal securities laws apply to those who offer and sell securities in the United States, regardless whether the issuing entity is a traditional company or a decentralized autonomous organization, regardless whether those securities are purchased using U.S. dollars or virtual currencies, and regardless whether they are distributed in certificated form or through distributed ledger technology.”
ICOs Delaying Crowd Sales
Several ICOs have already delayed their crowd sales because of conflicts with securities laws. The United States is not the only country getting involved. This week, Chinese regulators released a document which in effect has banned new projects that raise cash or other virtual currencies through cryptocurrencies. The working committee defined ICOs as “an unauthorized fundraising tool that may involve financial scams”, providing a list of 60 major ICO platforms for local financial regulatory bodies to inspect.
This has the potential to seriously disrupt the Chinese ICO industry which currently accounts for the fundraising of hundreds of millions of dollars. The markets initially fell deep into the red on the news out of China and the hammer has already begun to fall.
Several Chinese ICO platforms have halted services and BTCC, a Shanghai-based bitcoin exchange platform, said it halted trading of ICOCOIN. These actions appear to be the beginning of government intrusion, not the end. Investigations and delisting of tokens could have catastrophic effects on investors portfolios.
There is a tidal wave of regulation and intervention about to crash into the crypto markets and cause chaos, are you ready?
Cryptocurrency Self Regulation
One organization is looking to get ahead of this wave, helping businesses prepare and adapt before regulators take down half of the industry. The Exchange Self-Regulating Body (TXSRB.org) is looking to reign in the out of control ICO market. You can read more why digital currencies need a self regulating organization here.
There are hundreds of ICOs, raking in millions of dollars from crypto investors and many of these projects are nothing more than facades, allowing scammers to abscond with investor funds. If ICOs are associated with “financial scams” this will prompt a government backlash that could, cause exchanges to delist everything out of an abundance of caution or plain fear of being shut down by regulators.
The TXSRB is diligently working to mitigate this potential crisis by taking the following steps:
- Working to clarify what is clearly not a security
- Publishing a Clean Token List of coins that fit that non-security category
- Providing free guidance to all ICO issuers on how to clean up and pass the test
- Providing consulting services to clean up Toxic ICOs
- Eventually publishing their much longer Black List of ICO's that need to clean up and clean up fast
How to protect Yourself
The TXSRB has published a list of “Clean Tokens”, on this list is the cryptocurrency BitShares. BitShares is a decentralized exchange platform using real-time, industrial grade blockchain technology. Built with super-fast Graphene tech, the BitShares blockchain is capable of 100,000 transactions per second.
BitShares could be considered a great investment for a variety of reasons, including the platforms aforementioned speed and efficiency. It is however, the platforms status as a “Clean Token” which currently makes it such an attractive investment.
Several tokens made the “Clean Token” list, however BitShares is the first exchange platform to be cleared by the TXSRB. The platform offers the BitShares Decentralized Exchange (DEX). The DEX is a fully decentralized asset exchange, meaning you have total control over your private keys and your assets.
Decentralization of the exchange gives BitShares robustness against failure because any attack or failure impacts only a single user and their funds. Being among the first approved tokens by the TXSRB, the BitShares DEX has essentially become the safest exchange in the world!
BitShares allows for the creation of SmartCoins and user issued assets but it also has its own core currency, BitShares (BTS). BTS derives its value from the demand for BitShares services. By purchasing BTS, you are buying a stake in the success of the platform and investing in its future. Decentralized exchanges are no doubt the next step in crypto and BitShare’s relationship with the TXSRB puts the platform in a prime position to dominate the industry.
Holding BitShares BTS may be the best personal protection against the coming chaos and uncertainty in the crypto markets. The tidal wave of government intervention is approaching, are you prepared?
