ICO startups may soon find life simpler as the US Securities and Exchange Commission (SEC) is launching a new division to make it easier to navigate the legal ramifications that are affecting their products.
As regulations tighten on the Initial Coin Offering (ICO) sector, it is tougher than ever before for new ICO startups to jump through regulatory hoops. The SEC’s new division hopes to alleviate some of the issues these projects are currently facing.
ICO Startups Benefit From SEC Involvement
The SEC announced on Thursday that their new division will be called the Strategic Hub of Innovation and Financial Technology (FinHub). Their goal will be to simplify the process of an ICO startup when navigating the perilous regulatory framework that now dominates the industry.
The new agency will be a center point where the SEC can interact with developers and entrepreneurs across the financial spectrum with a particular interest in companies involved with distributed ledger technology (DLT). It will also focus on digital marketing financing and AI, while also offering automated investment advice.
FinHub will seemingly act as a buffer between new ICO startups and the SEC, on hand to clarify current regulations and as a collaborative body to work with the startups that are using emerging DLT technologies.
When talking about the new FinHub division, SEC chairman Jay Clayton was stated as saying:
"The FinHub provides a central point of focus for our efforts to monitor and engage on innovations in the securities markets that hold promise, but which also require a flexible, prompt regulatory response to execute our mission."
Comments From FinHub’s New Boss
The SEC’s senior advisor for digital assets and associate director of corporate finance, Valerie Szczepanik, will become the new boss of the FinHub division. It only makes sense that the division will be fully staffed with personnel who have previously worked for the SEC and have vast fintech experience.
When talking about the new division, Szczepanik was quoted as saying:
"SEC staff across the agency have been engaged for some time in efforts to understand emerging technologies, communicate the agency's stance on new issues, and facilitate beneficial innovations in the securities industry. By launching FinHub, we hope to provide a clear path for entrepreneurs, developers, and their advisers to engage with SEC staff, seek input and test ideas.”
ICO startups could greatly benefit from a service that gives them direct access to SEC and fintech experts who understand the regulatory requirements to becoming fully compliant.