Summary
The emergence of initial coin offerings (ICOs) as a new form of
fundraising and the dramatic gains in the price of many
cryptocurrencies is, without doubt, one of the biggest capital
markets stories of 2017. Notwithstanding a relatively widespread
view that we may now be within a cryptocurrency bubble, ICO markets
barrelled ahead in the third quarter, during which time135 ICOs
raising US$2.3 billion were completed. This represents more than
100% growth in ICO activity since the second quarter of 2017 and
dwarfs 2016, when ICOs raised a total of US$100 million for
the entire year.
In addition to valuation concerns, the ongoing crypto-mania is,
not surprisingly, drawing significant attention from securities
regulators who are growing increasingly concerned about the risks
and lack of investor protection inherent in most ICOs. In
particular, we have seen increased activity from the United States
Securities and Exchange Commission (SEC) in recent weeks –
with
