SEC Rules That ICO Tokens Are Securities (vice.com)

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SEC Rules That ICO Tokens Are Securities (vice.com)

Posted by BeauHD on Wednesday July 26, 2017 @12:45PM from the wild-west dept.

schwit1 shares a report from Business Insider: On Tuesday, the Securities and Exchange Commission (SEC) said that "ICOs" (Initial Coin Offerings) can sometimes be considered securities -- and as such are subject to strict laws and regulations. For the uninitiated, ICOs are a fancy new way of fundraising enabled by digital currencies like Ethereum -- participants invest money and receive digital "tokens" in return. Thus far, it has been largely unregulated, with some ICO crowdfunding events raising hundreds of millions of dollars -- leading some observers to argue that it is a massive bubble. But the SEC's warning means that this free-for-all may not last forever.

"Going forward, according to the SEC, companies that are issuing tokens as part of an ICO (if they are considered securities) need to register with the commission," reports Motherboard. "This will force companies to comply with regulations that ask them to reveal their financial position and the identities of their management. The SEC also concluded that online exchanges where tokens are bought and traded may have to register as security exchanges."

schwit1 adds a quote from Benito Mussolini: "All within the state, nothing outside the state, nothing against the state."

58 of 96 comments (clear)

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Overseas by dohzer · 2017-07-26 12:47 · Score: 3, Interesting

So launch them overseas. Problem solved.
1. Re:Overseas by Zemran · 2017-07-26 16:46 · Score: 1
  
  Do you honestly believe that statutes can stop people in the US buying things in Europe? Marketting is done on the internet which is global and sales take place on the internet. This is an unenforcable regulation and therefore stupid. The main hole in their logic is that they cannot come to terms with non physical property. They have searched people coming into the US looking for bitcoin as if they are going to find a physical object. They are regulating something they do not understand. It scares them but they have no idea what to do. Wise countries are embracing the technology but the US is, as usual, acting like a Luddite simply because they lack control.
  
  --
  I love stacking my barbecues in the shed at the end of summer - you can't beat a bit of grill on grill action.
2. Re:Overseas by AHuxley · 2017-07-26 17:17 · Score: 1
  
  Re "honestly believe that statutes can stop people in the US buying things in Europe? "
  Depends on the decade and what part of Europe or the EU.
  Foreign Account Tax Compliance Act https://en.wikipedia.org/wiki/...
  Go full Section 311 of the USA Patriot Act on anymore moving the funds around before, during or after interacting with anything "digital currencies".
  Select from never interacting with any bank or international banking network ever again or tell the US about people using any service.
  Report accounts or hops of total isolation start to be enforced. Isolate the service and then any bank or nation that still interacts with that service.
  
  --
  Domestic spying is now "Benign Information Gathering"
3. Re:Overseas by Anonymous Coward · 2017-07-26 19:26 · Score: 1
  
  Do you honestly believe that statutes can stop people in the US buying things in Europe
  The US Government has powerful methods at it's disposal to enforce compliance, up to and including disconnection from the dollar banking system (aka the financial nuclear option). So yes, I have no doubt that the US can stop pretty much whatever financial activity it doesn't like anywhere in the world. The real question is not can, because clearly they can, but rather will they? It depends upon how easy or hard the enforcement is and how badly they want to do it. Anyway, do you really want to be involved with an overseas "investment" that the US Government deems to be illegal? If you get cheated out of your money, who are you going to complain to? The US Government? People have the same problem right now with shady overseas gambling sites that stiff Americans because they know that they can get away with it.
This is healthy by Improv · 2017-07-26 12:50 · Score: 5, Insightful

I have little sympathy for technolibertarians playing word games to dance around sensible regulation. Particularly when they grumble that sensible regulation is fascism.

--
For every problem, there is at least one solution that is simple, neat, and wrong.
1. Re:This is healthy by bill_mcgonigle · 2017-07-26 13:36 · Score: 1, Offtopic
  
  I have little sympathy for technolibertarians playing word games to dance around sensible regulation. Particularly when they grumble that sensible regulation is fascism.
  So you believe that small investors should never be allowed to invest in a company by mutually agreeable terms with the company, without some parental agency dictating the rules and thereby precluding their consensual activities?
  Only rich folks should get to do that?
  It's hard to tell "smarter than you" from "you're too poor for equal rights" these days.
  
  --
  My God, it's Full of Source!
  OUTSIDE_IP=$(dig +short my.ip @outsideip.net)
2. Re:This is healthy by TooManyNames · 2017-07-26 14:31 · Score: 1
  
  Hey, it worked just fine for the mods... The GP is very insightful, don't you know?
  
  --
  "Is not a sentence" is not a sentence. Well damn.
3. Re:This is healthy by hord · 2017-07-26 15:02 · Score: 1
  
  Having an office filled with porn addicts isn't paradise either. People keep barking regulation but it also keeps failing us.
4. Re:This is healthy by Improv · 2017-07-26 15:10 · Score: 2
  
  The rights I care about are very differently flavoured than "opportunity to invest in a company", but yes. I think it makes sense to block people off from entirely screwing themselves over, and if that means less well-off people (often meaning people with no background in investment) can't invest this way, that's great.
  
  --
  For every problem, there is at least one solution that is simple, neat, and wrong.
5. Re:This is healthy by WhiplashII · 2017-07-26 16:34 · Score: 1
  
  No, the tragedy is that smart people that are not rich are denied access to startup company funding, and so are forced to remain poor.
  Fraud laws are sufficient to go after the bad guys. We need to allow more people to invest, not less. We should be encouraging investment as a society.
  
  --
  while (sig==sig) sig=!sig;
6. Re:This is healthy by Zemran · 2017-07-26 16:52 · Score: 2
  
  "entirely screwing themselves over" like people who invested in Bitcoin a few years back when they were $1 and now have something worth $1600... I wish I got screwed over like that. It does not matter. Such regulation is totally unenforceable and therefore totally stupid. More sensible governments are embracing such things and US people are totally welcome to invest in other countries under their laws. All this does is cut the US out of a growing sector.
  
  --
  I love stacking my barbecues in the shed at the end of summer - you can't beat a bit of grill on grill action.
7. Re:This is healthy by Aighearach · 2017-07-26 17:39 · Score: 1
  
  I have little sympathy for technolibertarians playing word games to dance around sensible regulation. Particularly when they grumble that sensible regulation is fascism.
  I know, they're so shocked that they're supposed to be honest about investments that they sell to people. How dare we not be allowed to lie about how much money people will make by giving their money to us?!
  They don't seem to understand that creating a "new" equivalent thing that is also being marketed for the purposes of investment is already some type of investment instrument. They were playing a word game, but they were doing something regulated all along.
8. Re:This is healthy by Aighearach · 2017-07-26 17:42 · Score: 1
  
  Well, when the rules that they're dictating are related to being honest about investment, then that is called "Capitalism." It is the very action of the government regulating trust to create a level playing field that allows capital to move freely. Without that regulated trust, established parties or the party controlling the information will conspire to keep new entrants out of the market. That is what Capitalism is all about. Read some Adam Smith sometime.
9. Re:This is healthy by Anonymous Coward · 2017-07-26 18:19 · Score: 1
  
  No, screwed over like "attended ITT Tech".
10. Re:This is healthy by Interfacer · 2017-07-26 19:00 · Score: 1
  
  Not really. If you throw good money at startups that don't even have a decent whitepaper, or that will only turn profitable if they somehow manage to take over the messaging world from whatsapp and messenger (the Status ICO) ... that isn't a tragedy. that is stupidity. Like using your life savings to buy powerball tickets.
11. Re:This is healthy by Interfacer · 2017-07-26 19:01 · Score: 1
  
  Oh Please, 9 out of 10 startups fail, if not more. If you are poor (or at least not rich enough to not care if the money is gone for good) then you shouldn't be funding startups.
12. Re:This is healthy by infolation · 2017-07-26 20:45 · Score: 2
  
  I don't think you appreciate the size of Maddof's fraud.
  Or what Maddof's fraud was, in relation to possible ICO fraud.
  
  Maddoff was able to perpetrate his frauds because he operated a Ponzi scheme within an investment black box that hid the mechanics of what and how he was investing funds.
  
  Good or bad, a DAO or any ICO operating directly on the Ethereum blockchain is, by definition, transparent. Anyone who can read solidity can look at its code and understand what it does, and will do in the future.
  
  If a reckless investor nevertheless puts money into a scheme that isn't governed by a democracy (smart) contract that gives them voting rights on whether the code base is changed, that's their fault. But the code is not a black box, as in Maddof's case.
  
  The SEC exists because, currently, financial institutions operate in a way that is very much un-transparent, and depend on investors trusting that the institutions are doing what they say they will do. Therefore the SEC is needed, to provide oversight of those 'black box' operations.
  
  A DAO is supposed to sidestep this, and enforce transparency by design. Which begs the question: does the SEC even understand why it's not needed to regulate DAOs or ICOs relating to DAOs on the blockchain?
13. Re:This is healthy by aaarrrgggh · 2017-07-26 21:00 · Score: 1
  
  I used to think the same way; the threshold of $100k was just there to protect the best returns for the rich. I have reviewed a few second stage funding proposals though (along with running my own business), and have also "lost everything" in the stock market a couple times.
  From this experience, I have become reasonably good at cutting through the crap. Sure, an investment in the next GoPro might yield a 5x return over 5 years-- but it is equally possible that it will only have a 5-10% annual return, or that you lose everything. (So, is it worth the risk?)
  Quite frankly most people can't make critical decisions with this kind of thing, and the safest bet is to limit investment to the $100k "play money" threshold.
14. Re: This is healthy by dnaumov · 2017-07-26 21:29 · Score: 1
  
  You are basically saying only rich people should be starting a business. How about you fuck off?
15. Re: This is healthy by religionofpeas · 2017-07-26 22:30 · Score: 4, Informative
  
  Starting a business is not the same thing as funding a (someone else's) startup.
16. Re: This is healthy by Interfacer · 2017-07-26 23:15 · Score: 1
  
  As religionofpeas said: financing a startup is different from starting your own business. If you are poor and have no money, you shouldn't be throwing it around as VC capital because there is a 90% chance you'll lose it all and you already had no spare money to begin with.
17. Re: This is healthy by Kiuas · 2017-07-26 23:58 · Score: 1
  
  You are basically saying only rich people should be starting a business. How about you fuck off?
  No, no he isn't Funding != starting. He's saying you shouldn't start a business and fund it yourself if that puts you in personal risk of bankruptcy. There's a major difference between that and 'only rich people should start companies." I've started one company so far, a year ago, with very minimal capital because we don't need to make heavy investments as a small IT-firm with all of us being able to work from home. If the company goes under, the amount of money that each of us will lose is such that it won't be a major problem.
  Startups fail at such a high rate mostly because people starting them don't realize how long it can take to start turning a profit. Even companies with solid business ideas and skillful people can fail because they haven't budgeted for the fact that they may well be running at a loss for the first 2-3 years. This creates a feedback-loop of failure wherein the urgency to get money flowing to the firm often drives them to push stuff out to market sooner than would be wise, which further contributes to their downfall.
  If you're planning on setting up a business and the monthly operating costs are such that you and the other owners cannot cover them by yourselves without risking your own financial safety, then you need to seek outside funding. That's the whole reason shares were invented in the first place: limited liability.
  The issue here is that certain types of ICOs function exactly like securities but have been unregulated. If this would have been kept going this opens a door for financial institutions to circumvent securities-related regulations by changing their securities into coins. It cannot be argued that this needs to be allowed 'for the sake of poor people getting funding for their startups' any more than it can be argued that I should be allowed to run a Ponzi.scheme to collect capital for my company.
  
  --
  "It is the business of the future to be dangerous" -Alfred North Whitehead
18. Re:This is healthy by MachineShedFred · 2017-07-27 01:15 · Score: 1
  
  especially startups that don't actually have a product or plan except wishes and other people's money.
  
  --
  Slashdot still doesnâ(TM)t support Unicode after it was added to the HTML standard in 1997.
19. Re:This is healthy by DigiShaman · 2017-07-27 01:26 · Score: 1
  
  Hahahaha!! Buddy, the US is already 20 TRILLION in debt. Other nations are going cashless and clamping down on how much money you can move around. Nation states, around the world - especially the US - fear that the US dollar won't just go into hyperinflation, but as a standard be abandoned all together like a used husk. Crypto currencies would be a money system without borders, much like the Internet. That freaks the fuck out of governments all over as it robs them of political power to oppress their constituents.
  We will see. There's nothing that prevents more alt-coin standards from being created. But yeah, what cannot go on forever, wont! And you can take that to the bank. LOL
  
  --
  Life is not for the lazy.
20. Re:This is healthy by Tenebrousedge · 2017-07-27 04:47 · Score: 2
  
  the US is already 20 TRILLION in debt
  That number includes debt owed by the federal government to itself. The bad day for the US is not when we have lots of outstanding debt, but when no one wants it any more. The actual $13.62T of debt is an enormous bet that the US will remain solvent. No informed persons worry about hyperinflation, and the topic of public debt is not particularly relevant. The SEC is attempting to regulate ICO tokens as investment vehicles because people keep trying to use them as such. There is zero reason to believe in the rest of your fantasies.
  
  --
  Those who advocate genocide deserve every protection afforded by law, and none afforded by common human decency.
21. Re:This is healthy by Improv · 2017-07-27 07:21 · Score: 1
  
  It's easy to praise this when investments go well. But were you to actually treat this thoughtfully and consider the actual "screw yourself over" case, you might reach a different conclusion.
  
  --
  For every problem, there is at least one solution that is simple, neat, and wrong.
22. Re:This is healthy by chuckugly · 2017-07-27 07:55 · Score: 1
  
  In what way does it beg the question?
So we start with Godwin and work our way back? by Frank+Burly · 2017-07-26 12:58 · Score: 5, Funny

The actual statement by the SEC is here: https://www.sec.gov/litigation....
It looks like people are investing money to obtain an interest in an item with no practical use other than as an investment
I am reminded of https://xkcd.com/1494/
Cows are already out of the barn by xxxJonBoyxxx · 2017-07-26 13:00 · Score: 1

>> "Going forward, according to the SEC, companies that are issuing tokens as part of an ICO (if they are considered securities) need to register with the commission..."

I hope they realize that almost a thousand different cryptocurrencies already exist:
https://en.wikipedia.org/wiki/List_of_cryptocurrencies
1. Re:Cows are already out of the barn by phantomfive · 2017-07-26 13:51 · Score: 2
  
  They can start arresting them one by one, and the cows will all return. No cow wants to be made an example of.
  
  --
  "First they came for the slanderers and i said nothing."
Oh puh-leeze. Mussolini? by ClickOnThis · 2017-07-26 13:07 · Score: 3, Insightful

I understand that many advocates of digital currencies sing the praises of their libertarian, state-independent qualities.
But conflating the SEC with Mussolini? Come on, the purpose of the SEC is to protect investors from unscrupulous companies. Do you really want the kinds of markets we had before the SEC was around?

--
If it weren't for deadlines, nothing would be late.
1. Re:Oh puh-leeze. Mussolini? by meglon · 2017-07-26 13:55 · Score: 1
  
  Yeh, let the anti-government fucks lose all their money to one of these unregulated con-jobs, then see what they say. These idiots aren't libertarians... they're just idiots.
  
  --
  Fascism: An authoritarian and nationalistic right-wing system of government and social organization. See also: NAZI's
2. Re:Oh puh-leeze. Mussolini? by anarkhos · 2017-07-26 15:48 · Score: 2
  
  the purpose of the SEC is to protect investors from unscrupulous companies. Do you really want the kinds of markets we had before the SEC was around?
  It's irrelevant what the purpose of a law or agency. The only thing that matters is its effect.
  Yes, the markets functioned better before the SEC. The real intent of the SEC is to make sure you're not allowed to invest in competing financial instruments and to make investors completely and utterly gullible.
  
  --
  >80 column hard wrapped e-mail is not a sign of intelligent
  >life
3. Re:Oh puh-leeze. Mussolini? by religionofpeas · 2017-07-26 18:12 · Score: 1
  
  These idiots aren't libertarians... they're just idiots.
  There's a big overlap.
4. Re:Oh puh-leeze. Mussolini? by NoMaster · 2017-07-26 19:24 · Score: 3, Interesting
  
  Not to mention the Mussolini quote dates from 1928 - a time when the USA didn't have a "rah rah democracy" foreign policy, fascism was considered a valid style of government and not a dirty word, and Coolidge, Hoover, and FDR were supportive of what they saw as a libertarian progressive Italian government that would resist Communism...
  
  --
  What part of "a well regulated militia" do you not understand?
5. Re:Oh puh-leeze. Mussolini? by AmiMoJo · 2017-07-26 23:43 · Score: 1
  
  Yes, the markets functioned better before the SEC.
  Yeah, 1928 was glorious. Maybe read the Pecora Commission's report on how awesome that time was for investors.
  
  --
  const int one = 65536; (Silvermoon, Texture.cs)
  SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
6. Re:Oh puh-leeze. Mussolini? by Neuroprophet · 2017-07-27 01:12 · Score: 1
  
  Clarification: When I say Dodd-Frank passed during the Clinton's, it was when Hillary was a Senator, I'm assuming you are including that as part of the "Clinton Administration". At least when I deal with most people who hate the Clinton's anything done while either one of them was in office that they don't like was a Clinton's fault...
7. Re:Oh puh-leeze. Mussolini? by ClickOnThis · 2017-07-27 08:34 · Score: 1
  
  Clarification: When I say Dodd-Frank passed during the Clinton's, it was when Hillary was a Senator, I'm assuming you are including that as part of the "Clinton Administration".
  Hillary Clinton moved from the Senate to Secretary of State on January 21, 2009. Dodd-Frank was proposed by the Obama administration in June 2009, and was passed on July 21, 2010.
  So no, Dodd-Frank was not passed (in fact, was not even under construction) while Hillary Clinton was a Senator. She may have been "in office" as Secretary of State, but was not in a role that had any significant influence on the crafting of Dodd-Frank.
  
  --
  If it weren't for deadlines, nothing would be late.
8. Re:Oh puh-leeze. Mussolini? by ClickOnThis · 2017-07-27 08:53 · Score: 1
  
  It's irrelevant what the purpose of a law or agency. The only thing that matters is its effect.
  The only thing that matters? Unlikely. But, um, okay...
  
  Yes, the markets functioned better before the SEC.
  FACEPALM. That is all.
  
  The real intent of the SEC is to make sure you're not allowed to invest in competing financial instruments and to make investors completely and utterly gullible.
  Wait ... didn't you just claim that an agency's purpose (i.e., intent) is "irrelevant?"
  The rest of your statement is hard to disentangle, but here goes.
  Unregulated financial instruments are a potential threat to the investing consumer, who must rely on the proper behavior of fiduciaries who are not compelled to behave transparently. Such instruments can "compete" just fine with regulated ones ... by becoming regulated. The effort is not trivial, but it is not onerous either.
  As for the SEC "making" investors gullible ... no, the SEC does not make investors gullible. They may or may not already be gullible. The SEC just ensures they have the information they need to make informed choices, so if they're still gullible, they have no excuse, and it's certainly not the SEC's fault.
  
  --
  If it weren't for deadlines, nothing would be late.
Thanks by phantomfive · 2017-07-26 13:12 · Score: 1

schwit1 adds a quote from Benito Mussolini:
Thanks, I wasn't sure if I should be outraged or not: now I know. sharp intake of breath, with fear and outrage.

--
"First they came for the slanderers and i said nothing."
1. Re:Thanks by PPH · 2017-07-26 13:46 · Score: 2
  
  Avoiding a Godwin Law ruling on a technicality: Good job schwit1.
  
  --
  Have gnu, will travel.
Court Challenge by LeftCoastThinker · 2017-07-26 15:17 · Score: 1, Insightful

I predict a court challenge in 3, 2, 1... Seriously, Etherium, Bitcoin and the like are unique mathematical stores of value, more similar to that rare drop you got in your MMO than a security instrument.

--
If you disagree, please post your argument. (-1, Overrated) isn't your personal censorship tool for views you don't like
1. Re:Court Challenge by DerekLyons · 2017-07-26 18:45 · Score: 5, Interesting
  
  Seriously, Etherium, Bitcoin and the like are unique mathematical stores of value, more similar to that rare drop you got in your MMO than a security instrument.
  It's funny... all the alt.currency advocates were all about how "cryptocurrency is real money" - until the government started actually treating them as real money. Now they're backpedaling.
2. Re:Court Challenge by Interfacer · 2017-07-26 19:04 · Score: 4, Insightful
  
  If I hadn't already posted I'd have modded you up. Either it is money or it is glorified pokemon cards. You can't have it both ways. Tbh I think it is good if it's going to be treated like money. I'd love for institutional money to flood in. Especially since I am already holding coin.
3. Re:Court Challenge by Anonymous Coward · 2017-07-26 19:47 · Score: 1
  
  i don't care about governments too much, they have already peaked anyway. bitcoin is decentralized, no money grabbing ICO and fair distribution. works with or without government support.
4. Re:Court Challenge by DigiShaman · 2017-07-27 01:32 · Score: 1
  
  Either it is money or it is glorified pokemon cards. You can't have it both ways.
  Yes, yes you can have it both ways, or rather it can be both ways depending on what the overall market says it is. One day your crypto-coin is worth value, another it can be halved or buried into a worthless group of numbers as the standard is abandoned.
  
  --
  Life is not for the lazy.
5. Re:Court Challenge by mysidia · 2017-07-27 04:12 · Score: 2
  
  Now they're backpedaling.
  Not really... it's "Real money" in the sense that you can reliably transact with it.
  It's not "Real money" in the sense that it is not a government-issued currency.
  Unlike real money, the government didn't make it and retain the rights to it --- so it's "More real" than money in the sense that it is more like tangible property with intrinsic value, and not something that can be arbitrarily manufactured.
6. Re:Court Challenge by DerekLyons · 2017-07-27 04:15 · Score: 1
  
  Either it is money or it is glorified pokemon cards. You can't have it both ways.
  I've pointed that out many times over the years... it's a deep flaw in the basic philosophy of crypto-currency - they want it both ways. They want legitimacy, *and* they want complete freedom with no controls or regulation. They don't grasp that the latter is a necessary consequence of the former.
7. Re:Court Challenge by swillden · 2017-07-27 05:38 · Score: 1
  
  Either it is money or it is glorified pokemon cards. You can't have it both ways.
  I've pointed that out many times over the years... it's a deep flaw in the basic philosophy of crypto-currency - they want it both ways. They want legitimacy, *and* they want complete freedom with no controls or regulation. They don't grasp that the latter is a necessary consequence of the former.
  Some probably do want exactly what you say. Others recognize that as a financial instrument regulation is inevitable, but still see value because although it's subject to regulation, the supply of a cryptocurrency doesn't have to be subject to any central control, unlike fiat currencies.
  
  --
  Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
Local laws apply. by DrYak · 2017-07-26 21:32 · Score: 1

Depends on the decade and what part of Europe or the EU.
US law do not apply anywhere else except in the US, no matter what some think.
What applies in countries in Europe, are international treaty that the have decided to adhere to and sign,
and local regulation.

Go full Section 311 of the USA Patriot Act on anymore moving the funds around before, during or after interacting with anything "digital currencies".
Select from never interacting with any bank or international banking network ever again or tell the US about people using any service.
It's a US law. It applies to the US. You cannot force - directly through government - a foreign institution to comply.
The only way the US can force foreign institution to comply is by putting a tax on any transaction that they have with dollars.
Or refuse to do interactions altogether with them.

Isolate the service and then any bank or nation that still interacts with that service.
...and some bank are completely happy with not doing any dollar transaction anymore and only transacting in Euros, Rubles, etc.

--
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]
1. Re:Local laws apply. by AHuxley · 2017-07-26 23:19 · Score: 1
  
  Some nations banks thought they could escape Section 311 of the USA Patriot Act.
  The sanctions go after the bank that does the transactions and any bank that deals with that bank.
  Then the nation allows the bank to operate.
  Nations and banks then have to disconnect from the US and most other banks or just stop doing the transactions.
  Report all the users and everything is back to normal.
  Foreign institutions have to comply or they cannot get access to the world banking community.
  Re "putting a tax on any transaction".
  Its a total disconnection.
  Re "not doing any dollar transaction anymore and only transacting in Euros"
  Any bank offering that service is then also discovered and isolated.
  
  --
  Domestic spying is now "Benign Information Gathering"
2. Re:Local laws apply. by Anonymous Coward · 2017-07-27 01:07 · Score: 1
  
  Yeah, ask banks in Iran how violations of US law only has consequences inside the borders of the US.
3. Re:Local laws apply. by Gr8Apes · 2017-07-27 01:53 · Score: 1
  
  US law do not apply anywhere else except in the US, no matter what some think. What applies in countries in Europe, are international treaty that the have decided to adhere to and sign, and local regulation.
  US law doesn't, but the treaties that have been signed and the effect of the gorilla cutting you off are certainly more than effective to convince many to cooperate.
  
  It's a US law. It applies to the US. You cannot force - directly through government - a foreign institution to comply. The only way the US can force foreign institution to comply is by putting a tax on any transaction that they have with dollars. Or refuse to do interactions altogether with them.
  Economic pressure is huge. Do recall the US is 25% of the world's market, and far more in trade and trade related partners. If I had to guess, I'd say better than 70% of all trade is tied directly to or controlled by the US either internally or via US corporations subject to US laws.
  
  Isolate the service and then any bank or nation that still interacts with that service.
  ...and some bank are completely happy with not doing any dollar transaction anymore and only transacting in Euros, Rubles, etc.
  Yep, let's look at Russia, the largest country by area with immense natural resources and roughly half the population of the US, yet less than 1/10th the economy. They're doing swimmingly. Iran with half the population and less than a quarter of Russia's economy. Venezuala, a super oil-rich country with a little over a third of the population of Iran does a little better at 3/4s of the economy of Iran, but that's still terrible compared to the numbers of any of the other countries that play with the US and partners.
  
  --
  The cesspool just got a check and balance.
4. Re:Local laws apply. by mysidia · 2017-07-27 04:00 · Score: 1
  
  You cannot force - directly through government - a foreign institution to comply.
  Right, but the foreign banks will choose to comply, because if they don't BACKUP WITHOLDNG will activate against that institution and apply to ANY funds transferred from overseas into a US-based bank.
Options by DrYak · 2017-07-26 21:35 · Score: 1

The US Government has powerful methods at it's disposal to enforce compliance, up to and including disconnection from the dollar banking system (aka the financial nuclear option).
and some institutions are completely fine with this, having enough other altenative options / big currencies.
Euros, Rubles, etc.
US Dollars haven't been the only internationally relevant money for quite some time.

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1. Re:Options by Gr8Apes · 2017-07-27 01:58 · Score: 1
  
  and some institutions are completely fine with this, having enough other altenative options / big currencies. Euros, Rubles, etc.
  US Dollars haven't been the only internationally relevant money for quite some time.
  Euros are directly tied to the US, even though they, the Yuan, and others are bucking for a new internationally based basket. It hasn't happened yet, but with the US being run by an ADD pinhead with the political finesse of an elephant with explosive diarrhea, such a decision is likely to happen sooner than later.
  
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Local (meaning national) laws apply. Good. by XXongo · 2017-07-27 02:49 · Score: 1

You're missing the fact that the EU also has regulations covering financial services to deter fraud, of course (look up "European system of financial supervision".)
So, basically, the article says that the SEC ruled that regulations to deter financial fraud apply.
This is actually good, not bad.
Except if you're a libertarian, and consider the right to be defrauded to be a form of "freedom"
Smart Contract by GrEp · 2017-07-27 05:41 · Score: 1

An ICO is just a smart contract software as a service. The company running the SAAS pays taxes on the ICO, those who buy them treat it as a service expense. If they sell their tokens they pay tax on the income.
The Fed is completely over-thinking this.

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