Why U.S Restrictions on ICOs and Exchanges Is Likely



today we're gonna talk about the Senate committee hearing where FCC Chairman Jay Clayton and CFTC chairman Chris Giancarlo testified on crypto currencies and I CIO's many news outlets and content creators reported on this event as a very positive and bullish sign which makes me almost wonder whether or not I watched the same hearing before I watch the hearing though I read the 10 page written statements from both chairman Clayton and chairman Giancarlo and there were some very consistent themes that we should be prepared for when they unravel first of all SEC chairman Clayton very clearly views all I ciose as securities and believes they should be regulated as such this isn't a new or particularly controversial standpoint but let me continue before you rush down to the comment section this was not only the primary focus of his written testimony but you can also see in the hearing how frequently he touches on the issue it was also fairly easy to tell from his tone of voice and demeanor that I SEOs generally discussed him and here's a clip to kind of illustrate that and I'm very unhappy that people are conducting i SEOs like public offerings of stock when they should know that they should be following the private placement rules unless they're registering with us those two things make me unhappy would figure out how to deal with them as is why we're here I I agree with you that we should be careful not to go too far but for me in the just to be clear for me in this ico space it's pretty clear that when people are violating our our our securities laws worked pretty well disclosure can be improved it can really be in ruin to him I SEOs are attempting to achieve all the benefits of both public offerings and private placements which is outright illegal and then arguably scummy as well even when done by quote-unquote legitimate people note that even CFTC Chairman Giancarlo who appears to be a Bitcoin Bowl was Stern on icos many of the Senators also seem to agree that icos are Manek now up until this point you might even be nodding your point as well because you agree with them most I SEOs who have not been done properly at best in our outright scams at worst but here's a detail you may have missed from the testimony SEC chairman Clayton's written testimony detailed how cryptocurrency exchanges have money transmitter licenses but aren't regulated as securities exchanges and hence aren't subject to a number of factors like a minimum level of cybersecurity and capital reserve requirements he also made clear that he doesn't like how many consumers trust these custodians despite the lack of regulations he noted that the money transmitter licenses weren't designed for this type of secondary market trading and that while AML and kyc requirements will help prevent some forms of crime as intended by FinCEN they don't protect consumers all that well however the SEC really doesn't have much authority in this area for as long as crypto currencies aren't deemed securities now let's take this information and connect the dots if the SEC deems all I SEOs are securities will there be any retroactive ruling applied China sort of went this route and it killed many projects the important ramification of them retro actively applying this rule would be that many existing all coins could become labeled as securities now take a moment and think about what that could mean what happens to an exchange like bit racks especially now that they want to introduce u.s. dollar trading which has many different crypto currencies listed rule the SEC explicitly state which all coins are securities or will it provide guidelines that businesses must follow and then enforce any violations against those guidelines will platforms like aetherium be targeted as they help ICO slaw in the first place both the written testimony and the hearing itself touched on the idea that cryptocurrency exchanges are not adequately regulated which could suggest restrictions in the future if all coins start becoming defined as securities there were some other warning signs as well that many people seem to ignore it was fairly obvious that SEC chairman Clayton doesn't view Bitcoin in high regards he avoided touching on Bitcoin too much likely because it isn't a security and because he wanted to focus on icos but he wasn't afraid to claim how he felt regarding its lack of usefulness and its inability to be an acceptable substitute for the dollar here's yet another clip that demonstrates that yeah look I there are a lot of smart people who think there's something to the the value of the cryptocurrency and the international exchange and I'm not I'm not seeing those benefits manifesting themselves in the marketplace yet and from the perspective look I look at this as effective of protecting Main Street investors they should understand that the the the funny thing about these crypto currencies is they only work if they're integrated with they only work for their purported purpose if they're integrated with the financial system and so therefore it necessarily touches on all of our regulation but I would be willing to bet money that he is someone that behind closed doors thinks that Bitcoin is more a fad than anything else it's worth noting too that this is how Bitcoin was frequently defined in the hearing as a substitute for the US dollar this is not how we want regulators to view Bitcoin at this stage because it warrants a much stronger response one of the senators very clearly Illustrated his distaste for crypto currencies as he felt that it undermined sovereigns and fiat currencies and I would just say to both of you to the extent that you have a role to play and you like the present authorities to do so I would I would love to know about that if you determine that is necessary because I get a my sense of crypto currencies largely driven to evade US sanctions and to undermine sovereign currencies if both of them are challenged to the national interest of the United States it's also worth noting that if SEC chairman Clayton doesn't have a positive opinion on Bitcoin which he doesn't seem to have that likely won't speed along the process of the first Bitcoin ETF he reiterated the SCC's prior statements on Bitcoin ETFs in both his written and spoken testimony regarding numerous concerns surrounding the product including liquidity security constatine ship arbitrage so on so forth as a result I think we can expect it to be a long time before a Bitcoin ETF hits the streets now moving on to the next concern senator Warner had some very positive remarks on crypto currencies notably that he felt blockchain in the currencies themselves weren't necessarily separable unfortunately he followed up with the idea of escalating crypto currencies like Bitcoin to eff sock or the financial stability Oversight Council now eff sock is responsible for evaluating factors which could affect systemic risk or in other words it is attempting to prevent the next 2008 type event naturally would not be good for Bitcoin to be considered a systemic risk especially given the fact that the chairman of eff sock is the US Treasury secretary aka Steve munition who recently went on record saying that he doesn't want bad people doing bad things with crypto currencies which is an often cited reason for regulation and oversight he's yet another character I wouldn't exactly characterize as being Bitcoin friendly another common theme throughout the meeting was that aside from CFTC chair giancarlo and Senator Warner the primary reason behind wanting to regulate with a do no harm approach was to allow blockchain to continue to develop not Bitcoin and I think this is a very important distinction because we've seen historically that both politicians and regulators are concerned with the use of Bitcoin in illicit activities this means that we could see a situation in which regulators target public blockchains aka Bitcoin and other cryptocurrencies but leave Enterprise blockchains alone this is further reinforced by the fact that the SEC chair Clayton and CFTC chairman Giancarlo both agreed that blockchain could be a way to improve regulatory oversight as it would increase the transparency of data note that the focus is not on decentralization but on how to better help the government have even more regulatory authority naturally this always starts out with good intentions but will end up usually being an invasion of privacy in the name of law enforcement I think that many viewed the hearing as exceptionally bullish for really two reasons one is because CFTC giancarlo clearly wants Bitcoin to have a chance to flourish and two is because the market was down and people were desperate to hear good news however many chose to ignore the sentiments of SEC chairman Clayton and several of the other senators as detailed in this video it's very easy to view news with rose tinted glasses especially when you are invested in whatever that news is about it is your responsibility as an investor to remove your bias prior to hearing new information so that you can process it as accurately as possible in the world of audio better microphones and headphones don't aim to make you or recorded audio sound better but rather to reproduce sound as accurately as possible which includes even impurities fun fact that's why more expensive microphone is generally going to sound worse than a cheaper microphone in a poor audio environment the point of this rather odd analogy is that you should always aim to process information as accurately as possible rather than as whatever best suits you and your needs lastly I want to be clear and say that the meeting was certainly not bearish for Bitcoin but there were many sentiments in the hearing that most ignored that I felt should have been discussed a little bit more the bullish elements of the Senate hearing have been covered on many different media outlets here on YouTube so that's the main reason I have chosen not to discuss them obviously there were some golden moments like Giancarlo talking about ha telling and respecting the sentiments of our younger generation with a thoughtful regulatory approach I'm just not certain how thoughtful that approach will end up being given that Giancarlo seemed to be mostly alone in that opinion for Bitcoin specifically rather than the blockchain like everybody else in other words he was somebody that really seemed to say we should be thoughtful about our regulations for Bitcoin and blockchain not just blockchain and it seems like everybody else is really just focused on blockchain as usual I hope you all enjoyed this video make sure that you check out my Steam it if you are interested in interacting with me as I tend to post a little bit more frequently on there and have more detailed answers just because the number of comments is a little bit more manageable otherwise leave a like comment and subscribe and I will get back to you as soon as possible thank you for watching

30 thoughts on “Why U.S Restrictions on ICOs and Exchanges Is Likely”

  1. Forgive me on mispronunciations, it's not my strong suit. Thought I'd provide my thoughts related to the Senate hearing – it's not bearish, but not exactly bullish either like many were laying out. There are some very obvious themes from the meeting that we should keep an eye on as they play out. If you would like to interact with me, make sure to check out my Steemit: steemit.com/cryptocurrency/@cryptovestor/why-u-s-restrictions-on-icos-and-exchanges-is-likely. I also post live updates on Twitter: twitter.com/Truth_Investor.

  2. Twitter has verified the reports from beforehand this month that it will ban advertisements for Initial Coin Offerings (ICOs) all round the world. From now on any undertaking that is conducting a token sale will solely be allowed to run commercials on the social community if it can prove it is legally regulated in the targeted country. Wallets and exchanges will also have a excessive bar to cross.
    https://www.coindais.com/twitter-confirms-restrictions-on-icos-and-cryptocurrency-token-sale-ads/

  3. Thank you for posting this crucially useful, intelligent report about the SEC process commencing. Well done, bravo.
    I've been heavily invested in cryptos, and have done well, but your video has combined in effect with my own watchful eye on the growing regulatory intervention.
    After a lifetime of working for more than ten government departments, and some banks, I know very well how soberly these people think and function. I even 'was one of them'.
    There's a big contrast between the cryptocurrency fraternity's cheery, bold, defy-convention enterprise, and the authoritarian mindset of public-appointed collar-and-tie government officers.
    So I decided after seeing your video to retreat almost completely (for now) into the relative safety of 'fiat' until this process either ravages and cripples the cryptocurrencies, or releases them into another phase of acceptance and prosperity, which I actually doubt. I've done okay this past year, but despite the conversion costs and transaction fees, I'm glad to be out of it now.

  4. That guy that was disgusted, the one that had a close up, Clayton…. he had serious SNAKE EYES. Or is it my screen or the quality of the video? Scary eyes man….

  5. Whenever there is a chance to tax, especially significant amounts, it will be done.
    None of it is about regulated, aside from making sure they get their tax cut and any loophole to avoid the user paying it is removed.
    I can't wait for DEX and Privacy coins to adopt, and having retailers accept them as a form of payment would be absolutely amazing.
    I am holding my DeepOnion for the day that people realize the significance of Privacy coins and improvements in both speed and anonymity over other existing options.

  6. Hi falks, there is a crypto game called Aethia similar to cryptokitties (who doesn't know about it, check that out you can earn some money). Here is the link if somebody would like to sign up and play: https://aethia.co/welcome/SHgFPpWYIYyurj7iGj5D17EgR6661fOy

  7. US credit is worthless. Tell those cuckold senators to pour their liquidity into crypto before their dollars are worth nickels.

  8. Going into this hearing. the market was tanking. Most thought this was happening because there was going to be very bad news coming out of this meeting.. So they thought the negative news coming was baked into the price. Since this hearing was more neutral than negative. Everyone took that as great news… which.. in fact. it was.

  9. i just watched the whole thing. it sounded pretty neutral to me. i hear your point on ICO's. it sounds like thats the area at risk as it appears to be under their jurisdictions, for some reason. that said… they all seamed clueless and don't se anything happening soon.

  10. A solution to snake oil salesmen needs to be invented, if you don’t want government regulations.
    There’s a good number of scams going on. That’s what happens in a free market with no regulation, and no way to capture the culprits.

    If anyone knows of an existing solution, let us know.

    If they are not going to try to stop it, and make it illegal like China is doing, then the news is bullish.

  11. They can still do nothing with people behind VPNs and nothing about DEXes. Outregulating scams from ICOs is great though.

    Make tax use completely transparent for people to see where the funds really go. Then the state will not have to worry about tax avoiders because as I see it most of them avoid taxes because they dont believe the current system is 100% clean from stealing and fraud in higher places. The only better solution right after that is direct democracy. Thank god/universe/allmighty for DL tech. : )

  12. good luck regulating a decentralized exchange. i can run an etherdelta server, on my home computer and it will talk to the blockchain

  13. Cointelegraph, coindesk and any crypto "news outlet" are so biased, that it gives a lot of people wrong view, there is always some manipulated, and this manipulation is enough to make people, that it's different than it really is in reality.
    Makes you wonder, that people in those news aren't really true to their mission, of having objective and non-biased news, but are just as biased, and manipulated as mainstream news outlets. In facts, it's even worse – mainstream news outlets, seems to at least try to have sources, and present whole story, instead of cutting out pieces of whole video and whole meeting. This crypto outlets, seems to be mostly shilling something, or if something goes not in the pro-crypto way, it's almost always "a fud". Like true legitmate news about crypto have dissaperead somewhere between 2016-17, when these websites weren't so biased, and hostile, to critics of crypto space markets, and massive manipulation, that there is going there.
    Any critic to crypto market is always thought as fud, from 2017, I mean wtf? Are they paid by bitfinex and tether, or what?

  14. 100% agree with you. Crypto tards believe that those guys are bullish because one guy 'Giancarlo' didnt trash BTC. Another topic you should debunk is this myth that 'institutional investors' are coming in soon. They are not. Yet people day dream about this as if it will moon the entire market in a few months. Not even close ATM.

  15. People calling the SEC meeting as "make or break" were probably relieved to hear something different than a total shutdown.

  16. It was a very good meeting. Only you can see the negative in everything. Well, you might be right about a lot of things, but if it was all about this meeting we would have a green card for all crypto in the years to come.

  17. I think you're spot on and I don't think you're being 'bearish' but being truthful. We should look at EVERY intrusion of government regulation with extreme skepticism. At the 9:20 mark you talk about how this will eventually lead to an invasion of privacy and that's another item I agree with. Illegal activity will always be used by authorities to remove rights. In my experience governments (US included) always over reach… and once grabbed it never goes back.

    This trend will continue and so I believe privacy based coins will continue their growth from 2017. Coins like Monero, Zcash, and especially DeepOnion will grow. Lower marketcap like coins like DeepOnion will see 10x growth by the end of the year considering it leverages TOR and not the standard internet.

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