SEC Commissioner Claims That Safe Harbor Proposal Could Worsen the Issues With ICOs

Caroline Crenshaw, an SEC commissioner, stated that the earlier proposed safe harbor laws could cause more issues with ICOs and investors. She made these remarks during the annual SEC Speaks event and recently posted her speech on the SEC website.

Problematic Offerings Are Always Present

These problems first occurred back in 2017 and 2018, when the initial coin offerings started blooming. According to Crenshaw, the ICOs’ impact on investors would have been far more significant if the laws were there at that time.

While ICOs were popping up all over the market, investors flocked to get into them, only to see that many wouldn’t deliver on their promises.

What Is a Safe Harbor Proposal?

This proposal has been advocated by Hester Peirce, aka Crypto Mom. The proposal sought to grant network developers a three-year grace period, during which the SEC legal actions won’t occur. This was supposed to provide enough time for the projects to build their products without fearing SEC.

Peirce revised this idea back in March. However, Crenshaw argues that the investor’s funds would only be put at further risk. By giving a few years to the projects, the investors remain unprotected during that time.

Crenshaw also called for a bridge in which ICOs and other crypto firms would work together with the SEC to help outline the regulatory compliance.