On Tuesday, January 14, the U.S. Securities and Exchange Commission (SEC) sent a warning from its Investor Education and Advocacy wing, urging citizens to be wary of initial exchange-managed coin offers (IEOs). More specifically, in the document in question, it can be read that:
“Be cautious if you are considering an investment in an IEO.
Complaints of new technologies and financial products, such as those associated with digital asset offerings, and claims that IEOs are controlled by trading platforms, can be misused to lure investors with the false promise of high returns in a new investment space.
IEOs may be conducted in violation of federal securities laws and lack the main forms of protection normally guaranteed to investors for security offers. "
The sense of the ICOs was to be able to finance itself without being forced to take on all the extremely onerous obligations to which a company is subjected when it decides to go public; as the spread of scams of all kinds has led global institutions to rigidly regulate these tools, ICOs have lost their sense and usefulness.
The world of crypto has gone to cover by inventing the IEOs, which are nothing more than initial offers of coins (just like ICOs were) but which are managed by the exchange platforms instead of directly by the entity (which can be a company but also a non-profit organization) that issue tokens; since the exchanges, at least the most important, are already in possession of licenses to operate in the fintech area in all legality the obligations to be borne are much lower and so the system is once again circumvented.
This demonstrates how impossible it is to regulate the sector, since the players in the crypto market respond to the slowness of the institutions with an impressive speed, avoiding any attempt at regulation; net of this it must be said that, at least, the SEC, as well as other institutions such as, for example, the Chinese and Japanese ones, tries to keep up with market developments, in Europe instead, the institutions do not even seem to have understood which way to start regulating the market, they are in full confusion and every time they open their mouth they show that they do not have even the slightest knowledge of the sector that they should regulate.