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The U.S. Securities and Exchange Commission (SEC) Strategic Hub for Innovation and Financial Technology (FinHub) published a framework on April 3, 2019, for analyzing whether a digital asset is offered and sold as a security under the federal securities laws. The framework includes “common sense guidance” that provides greater detail and clarity regarding the application of the federal securities laws to digital assets and is intended to be “an analytical tool to help market participants…
Both the SEC and FINRA recently released their 2019 Examination priorities, (available here and here) highlighting primary areas of focus for 2019.  While there are no surprises, there are some items that have a unique twist that warrant attention.  In this post we provide an overview of the regulators focus on Reg SHO and short selling. Both regulators will continue to focus on aspects of Reg SHO compliance.  FINRA will be focused on the…
On December 21, 2018, the U.S. Securities and Exchange Commission (“SEC”) announced enforcement actions against two robo-advisers, Wealthfront Advisors LLC (“Wealthfront”) and Hedgeable Inc. (“Hedgeable”), for making false statements about investment products and publishing misleading advertising. “Robo-advisers” are investment advisers that provide automated, software-based portfolio management services. In a press release related to these actions, the Chief of the SEC Enforcement Division’s Asset Management Unit stated that “[t]echnology is rapidly changing the way investment advisers…
On Wednesday, December 12, 2018, the D.C. Bar hosted a panel to discuss current developments in the world of crypto.  Among the panelists were two senior SEC officers: Jonathan Ingram, Deputy Chief Counsel, Division of Corporation Finance, and Jennifer Leete, Assistant Director, Division of Enforcement.  Also participating on the panel was Era Anagnosti, a former senior manager in the Division of Corporation Finance of the SEC who in part oversaw the process relating to, among…
Through their recent actions and statements, the Securities and Exchange Commission (SEC) has further clarified their position with respect to digital assets and ICOs. Following on from earlier enforcement efforts throughout 2017 and 2018, the SEC Enforcement Division settled cases with AirFox and Paragon, two issuers of unregistered securities in tokenized form, in addition to a settlement with the founder of a purported decentralized exchange, EtherDelta. The SEC Policy Divisions released a rare joint statement…
On October 18, 2018, the U.S. Securities and Exchange Commission (SEC), announced the launch of the agency’s Strategic Hub for Innovation and Financial Technology (FinHub).[1]  FinHub is a resource for industry engagement between financial technology companies (fintechs), market participants, the public, and the SEC.  This client update provides a high-level overview of the FinHub initiative and how the SEC envisions industry participation. FinHub is designed to serve as a focal point for the…