The cryptocurrency market is suffering a bloodbath since the start of November. Bitcoin [BTC] has fallen down by approximately 80% since its all-time high. Stephen Palley, a blockchain and virtual currency Attorney spoke on Bloomberg regarding the recent crash of the cryptocurrency market.
Stephen Palley said that ICOs were interesting while they lasted because people could start a business and get investment capital without having to worry about the securities that the IPOs were usually burdened with. According to him, ever since the crackdown by SEC, ICOs have drastically reduced. He added:
“I don’t think that the model [ICO] is completely gone now. But the US is not the only market in the world and securities laws are different elsewhere. So I don’t think that we’ve seen the end of this, but what its gonna look like in the United States. I’m not sure.”
He went on to speak about what the crackdown meant for Bitcoin and other cryptocurrencies and said that he is a believer in the blockchain technology and also believes in Bitcoin. Palley stated:
“Also I would not write off Bitcoin, and I would not write off Ethereum and these are very interesting technologies. And if we were looked to look at this in terms of investment, it’s, you know, some people have won a lot. Some people have lost a lot, but its technology itself remains interesting.”
Stephen Palley spoke about the decision by the Securities and Exchange Commission [SEC] on two cryptocurrency startups [Paragon and AirFox] that were hosting illegal ICOs. He said that SEC is not in the “business of sending messages” when it comes to enforcing companies that violate securities laws. He said:
“If you look at the Paragon or AirFox orders that came out on Friday what they [SEC] say is actually pretty common sense, which is just because it’s newfangled technology doesn’t mean that established security principles don’t apply.”
He further added that these bold statements made by SEC are not the reason for the drop of Bitcoin’s prices. Palley stated:
“I’m not sure that there is necessarily any connection between recent SEC activity and the price of cryptocurrency that may or may not be the case but it’s difficult for me to see a necessary cause or relationship.”
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