Market Analysis

Altcoins keep on taking a hit in the wake of SEC’s preparations to tackle crypto startups

Altcoins keep on taking a hit in the wake of SEC’s preparations to tackle crypto startups
Nov 15, 2018 by Rico Wise

ERC20-based currencies, operating on the Ethereum platform have displayed a specifically poor performance versus bot BTC and USD within the past few days.

WanChain, Lisk, Wlatcoinchain, ICON, VeChain, Ontology, Golem, and plenty of other altcoins supported by very involved developer and financier communities dropped significantly over the past seven days. Even BAT and ZRX, which recorded confident short-term price growth before the Coinbase listing, decreased by over 36%.

The inclusion of BAT and ZRX into the operations of Coinbase cryptoexchange served as a confirmation that the two currencies are not viewed as securities in accordance with current financial legislation of the United States. Coinbase takes careful steps upon listing currencies on the exchange in fear of becoming a target of the US SEC for distributing unregistered securities.

There is a possibility that the Securities and Exchange Commission is getting ready to put down a lot of cryptoexchanges and ICO startups, with lots of cases currently pending with the Commission.

According to the official statement, the SEC revealed that Zachary Coburn, a co-founder of EtherDelta has complied to settle 300,000 USD in disgorgement, 13,000 USD in prejudgment interest, and another 75,000 USD as a penalty, displaying that the issue of Coburn and SEC was solved before the announcement.

Stephanie Avakian, the co-director of the Commission’s Enforcement Division, has recently made a confirmation regarding the major flow of inquiries into initial coin offerings coming soon, and stated that more investigations are to take place as well.

Within the months to come, the cryptospace is anticipated to experience the resolution of numerous pending cases versus cryptoexchanges and initial coin offerings, initiated by the US SEC. The regulatory ambiguity in the market of initial coin offerings connected with altcoins might cause a drop financiers’ confidence in respect to lesser market capitalization digital currencies.

Zachary Coburn and his co-founded cryptoexchange EtherDelta were accused of distributing unregistered securities, suggesting that the SEC has collaborated with Coburn to comprehend the nature of the many altcoins that are viewed as securities in accordance with the US policies.

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