Over the last five years, there has been a flurry of new cryptocurrencies coming on the market. Most of these new coins have been issued through the form of an ICO or initial coin offering. But there remain a number of pressing issues with the circulation of these new cryptocurrencies, their valuation and the overall legality of both owning them and participating in their issuance.
Shervin Pishevar is one of the leading figures in the world of fintech. He is the founder and CEO of Investment company, one of the most revered venture capital firms in Silicon Valley. He has also been a successful entrepreneur on his own, personally founding such companies as Virgin Hyperloop, WebOS and Social Gaming Network.
Shervin Pishevar has also been one of the loudest cheerleaders for Bitcoin while also serving as a voice of reason on the realities of initial coin offerings.
Even one egg may be too much for the basket of cryptos
The main message that Shervin Pishevar wants to get across is that ICOs and many of the new coins that they represent may be extremely risky from a variety of different perspectives. First, Shervin Pishevar says that cryptocurrencies, including tokenized assets, are very likely to ultimately be ruled to be securities. He says that the Securities and Exchange Commission is already vigorously investigating the surge of ICOs that have recently taken place. And Shervin Pishevar warns that the agency is very likely to take action against some or even all of the recent coin offerings and everyone involved in them.
He says that this could put investors at serious risk as the SEC is known for using strong measures, including the dreaded claw back, to recover funds that were lost by certain classes of investors and indemnify them. Pishevar says that these tactics are likely to be used in the case of ICOs, especially those that involved any form of outright theft or fraud. He says that people who believe that they fairly earned money in those transactions are at serious risk of having their profits confiscated and redistributed to the losers.