The company behind EOS, block.one has just been whacked in the face with a $24 million fine in regards to is initial coin offering (ICO) back in 2017.
We’ve spoken about block.one before at CryptoDaily but here’s a brief recap of what the firm is:
“block.one is a company registered in the Cayman Islands, which began offering EOS tokens in June 2017 to the public, raising over $4 billion (a record for an ICO).”
In terms of the aforementioned fine, while it might seem a little harsh, this isn’t actually that big of a penalty. Only when you compare it to how much it raised for its ICO back in 2017.
As reported by CCN:
“It’s an arbitrary and dangerous precedent from the Securities and Exchange Commission (SEC) and risks triggering another wave of scammy ICOs.”
This also proves the SEC is still unaware or doesn’t have much of an idea on how to regulate cryptocurrencies.
Nic Carter at Castle Island Ventures said, “a lot of founders are going to think the SEC gave ICOs carte blanche after today and they’re going to get absolutely rinsed. Not sure how to feel about that.”
Given that the ruling doesn’t make it clear as to what a security is, this fine is slightly random.
Carter continues, “Caprice and arbitrariness are absolutely the worst features of a regulator and yet there aren’t two more fitting words for the SEC.”
ICO’s are a controversial topic in the crypto space as many of them are seen as untrustworthy or scams. Understandably so though given that so many have turned out to be fraudulent.
But even so, as a rule of thumb, ICOs are not a bad thing. They’re an innovative approach to funding.
It will be interesting to see how this situation plays out. For more news on this and other crypto updates, keep it with CryptoDaily!