Better late than never, an ordinary American can now think of investing in cryptocurrency offerings, including initial coin offerings (ICOs), and the credit goes to the new rules proposed by the U.S. Securities and Exchange Commission (SEC).
Under new rules, anyone can trade crypto by participating in ICOs – all they have to do is prove their credentials, which could be their education and income.
Cryptocurrency is gaining popularity as an alternative currency with every passing day. The introduction of such game-changing rules at this time is something that would lure more people into trying their hands at ICOs.
Previously, accredited investors were the only ones who could buy crypto. But with new rules, the SEC has now eliminated this sole requirement by creating equal investment opportunities for both accredited investors and the public.
However, there are downsides to the new rules as well. The SEC and analysts believe that the new rules would not make any big difference to the investment trend.
The SEC cites the inclusion of income as an eligibility criterion to be the main reason behind this, while analysts are also in agreement that the wealth will still play a crucial role.
Considering these downsides and anticipating the limited success of the new rules, suggestions have started pouring in the SEC.
One such suggestion came from SEC commissioner Hester Peirce when she advocated for allowing unsophisticated retail investors to participate in ICOs as well as initial public offerings (IPOs). Her only argument for this was that the wealth should not be a deciding factor when making investments in private offerings.
Another thing that might trouble those willing to invest in ICOs is the evaluation of their educational credentials by the SEC.
Speaking about which, Peirce said that while evaluating these credentials, it is quite possible for the SEC to end up evaluating the educational institutions, and if that happens, results could be far from expected.
Based on these suggestions with more to come, we expect the SEC to modify the rules further to include many investors. But for now, these are mere speculations, and the crypto community is all set to take advantage of the new rules.