The Securities and Exchange Commission will monitor companies that are changing their names and business models to attract investors using block-chain technology, Bloomberg reported Tuesday.
SEC Chairman Jay Clayton said in a speech at a conference in Coronado, California that the agency is “looking closely” at the disclosures of those companies to check whether they comply with securities laws.
Clayton also raised concerns over the “completely unregulated nature” and retail focus of cryptocurrencies and related offerings.
He cited scenarios where lawyers do not counsel clients on the need to comply with securities laws when dealing with initial coin offerings.
“I have instructed the SEC staff to be on high alert for approaches to ICOs that may be contrary to the spirit of our securities laws and the professional obligations of the U.S. securities bar,” Clayton noted.
He added that SEC is working to educate the public on risks associated with unregistered securities investments offered by unregistered promoters.