ICO ban is underway in United States currently. Many of the people think that the initial 12-month ban is just the beginning. It can increase even more.
Prolonged ICO banned:
The main reason is that there is no proper asset classification for ICOs in the United States. Many of the entrepreneurs as well as the companies which are launching the ICOs think that the ICOs should be considered as utility tokens. If they are considered as utility tokens, a different set of rules will apply to them. On the other hand, most of the authorities are thinking to categorize them as commodities as well.
Amid all of this confusion, it is not sure when the ban will be lifted as well. If this confusion persists, it will mean that ICOs can remain banned for a longer period of time. This is one of the main reasons why investors are still not sure if the ban will be lifted or not.
According to a statement by the Chief legal and risk officer of Coinbase, Mike Lempres, the current ICO market is at a complete standstill. There is no exemption at all for any kind of ICO. This is the reason why investors are not able to invest in any kind of ICO currently.
With the regulators not even attempting to look into the matter, the ICO ban can remain for a long period of time. This will be a step back for the cryptocurrency market.
Difficult to get the identity of utility tokens:
Currently, as things stand, it will be very difficult for the cryptocurrency tokens to get the identity of utility tokens. SEC has gone ahead and already served subpoenas to an ICO by the name of Munchee in December. This is really negative news for the ICO industry. The dispute is on the point whether ICOs can be considered as utility tokens or whether they should be considered as security tokens.
With this action being taken by the SEC, many other companies launching the ICOs have completely junked the plans. They do not want to get into any kind of legal trouble.
With no progress on this matter, it seems like the ICO ban can remain for a longer period of time. This means that the investors in the United States will not be able to invest in many of the upcoming ICOs which are being launched all over the world.