Reed Smith Client Alerts

The spot market for digital tokens, which was once a “wild west” seemingly outside the scope of most federal regulations, is being integrated into the emerging Federal and State regulatory regime. In a period of just over two weeks, the Securities and Exchange Commission suspended trading in company securities of three publicly-traded blockchain-related businesses. Two of these companies have issued digital currencies in the past or intend to do so in the future. The third such company intends to launch a digital currency exchange. Even if a token being offered does not qualify as a security, the SEC may nevertheless suspend trading in the securities of an issuer, or take other enforcement actions with respect to a company or offering otherwise subject to SEC regulation if there is inadequate or inaccurate disclosures with respect to the token being offered or other proposed activities.

Authors: Herbert F. Kozlov Aron Izower Kari S. Larsen Michael Selig

Type: Client Alerts

In a period of just over two weeks, the Securities and Exchange Commission (“SEC”) suspended trading in company securities of three publicly-traded blockchain-related businesses. This follows closely after the SEC’s July 25 investigation report on The DAO ICO.

On August 28, 2017, the SEC suspended trading in the securities of American Security Resources Corp (“ARSC”), which intends to launch a digital currency exchange, because of questions about information included in press releases regarding the company’s business transition to the digital asset markets and adoption of blockchain technology.1