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What’s in a Blockchain Name? SEC Demands More Than Investor Bait

Companies looking to ride the cryptocurrency wave are drawing a stern warning from the top U.S. securities regulator: You better do more than change your name.

The Securities and Exchange Commission will be watching firms taking on new names and business models to make sure they’re not just trying lure investors eager to jump on the blockchain bandwagon, Chairman Jay Clayton said Monday in comments prepared for a conference in Coronado, California.

“The SEC is looking closely at the disclosures of public companies that shift their business models to capitalize on the perceived promise of distributed-ledger technology,” Clayton told an audience at the Northwestern law school conference. The SEC wants to ensure those disclosures comply with securities laws.

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Clayton has been sounding the alarm about initial coin offerings, which he says often are technically securities whose issuers in many case aren’t complying with U.S. laws. He didn’t name any names in his speech, delivered by video conference because of the government shutdown, but quipped about a company with no cryptocurrency expertise changing its name to “Blockchain ‘R Us.”

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