21 Jun 2018
Nasdaq CEO Friedman warns about ICO risks, adding that this trend is mostly the result of lacking public information. The insufficient transparency, accountability, and regulation have had their effect, too.
21 June, AtoZ Markets – The CEO of Nasdaq, Adena Freidman, has stated that Initial Coin Offerings (ICOs) pose “serious risks” for retail investors, according to some of online reports.
Mrs. Friedman has reportedly spoken at the Future of Fintech conference in New York on Wednesday. During her speech, she has made it clear that she has a “real concern” about ICO projects. She has stated that these projects significantly defraud retail investors. In fact, she has noted that this trend is mostly the result of lacking public information. The insufficient transparency, accountability, and regulation have had their effect, too.
Mrs. Friedman has explained:
"To make it no rules at all, when companies can just willy-nilly take people's money and offer no information at all, with no governance, that sounds to me like you're taking advantage of people."
She has also highlighted that ICO scam victims are normally beginner investors. These people have very limited access to information. According to Mrs. Friedman, the US Securities and Exchange Commission (SEC) requires firms to provide retail investors with the same information as banks in Initial Public Offerings (IPOs). However, in reality, ICOs have “almost no oversight.”
According to Mrs. Friedman:
"In ICO space none of that is available, and it's all being bought by retail. ...I have real concern on lack of transparency, oversight, and accountability that these companies have as they're going out to raise capital through an ICO."
She has also stated that she supports SEC’s claims that ICOs are securities offerings. She added:
“I support the SEC on that."
Yesterday, we reported that CBOE Global Markets CEO Chris Concannon has stated that the ICO market soon will experience a regulatory “reckoning.”
According to Chris Concannon, the ICO market regulatory reckoning will emerge in two steps. Firstly, the key financial securities markets regulator of the US, the US Securities and Exchange Commission (SEC) will categorize ICOs as unregulated securities. In this case, the investors’ holdings would be “rendered valueless.” This also would consequently cause the second step to kick in.
The second wave would include a flow of class-action lawsuits to be filed against the firms operating ICO projects.
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