The SEC chairman warned against the heat of the blockchain listed companies

nRunaway Comment: Both ordinary investors and Wall Street investment agencies have benefited a lot from investing in cryptocurrencies and blockchain-related technologies. However, as the popularity of the blockchain continues to increase, more and more listed companies have begun to take advantage of the current imbalance between supply and demand in the cryptocurrency market and support the share price through the blockchain. In response, Jay Clayton, the chairman of the Securities and Exchange Commission, said in a few days ago that the regulator is closely monitoring the disclosures of these companies. In the future, the SEC will take a tougher stance on these listed companies, which is not necessarily a bad thing.n
nTranslation: Clovern
Everyone now knows that ordinary investors and Wall Street investment agencies have achieved great success in investing in technologies that secure currencies and blockchains.n
But now it is almost impossible to invest in cryptocurrencies or legally cryptocurrency companies if you want to invest in SEC-sanctioned ETFs or on the Nasdaq or NYSE-listed stocks. As a result, some smaller public companies availed themselves of the imbalance between supply and demand and took some steps toward “turning” their business to blockchain technology or even changing their names to cryptocurrencies. Since some ordinary investors did not really understand the essence of these companies, they only wanted a share of the cryptocurrency boom. As a result, they bought the stocks of these companies and considered what they said was true.n
So a few days ago, the chairman of the Securities and Exchange Commission (SEC), Jay Clayton, warned these companies when speaking to securities regulators.n
n”Before I move on to the next topic, I want to hypothesize how to come up with a more precise legal issue with a distributed ledger (or blockchain) and I wonder if anyone in the audience is able to accept that a listed company has nothing (1) begin to engage in blockchain activities, (2) change its name to ‘blockchain XXX’, and (3) change the name of the blockchain to ‘ The securities are issued immediately without full disclosure to ordinary investors of the details and risks involved in these changes.SEC is closely monitoring changes in the business model of listed companies and using the information disclosure of the promising outlook of distributed ledger technology and focuses on Whether these disclosures are in compliance with the securities laws, especially in the case of securities issued. “- Jay Clayton, SEC Chairmann
nWhat type of questions does President Clayton talk about?n
When the beverage company Long Island Iced Tea changed its name to Long Blockchain Inc., and then the share price is guaranteed 500% in one day, what would you think? Or what would you think when Kodak’s stock price tripled after it announced the launch of ICO? Or when another low-cap company bought a cryptocurrency microfinance startup that acquired 95% of the company’s CEO (in fact never issued a cryptocurrency-backed loan)?n
Going forward, it is expected that the SEC will take a tougher stance on publicly traded companies that either quickly change their name or change their overall business strategy to make use of cryptocurrencies and blockchain hype. But this is a good thing. Many ordinary investors have little knowledge of cryptocurrencies, do not know what is legitimate technology, and do not know if the company changes the name simply to support the stock price. The sooner we get out of this fraud, the sooner regulators like the SEC can allow ordinary investors to invest directly in cryptocurrencies and other promising blockchain technologies.n

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