On July 25th, the Securities and Exchange Commission (SEC), citing the long established “Howey Test”[1] and other cases,[2] determined that a public offering of digital tokens known as “the DAO” was in fact an offering of securities that was subject to federal law. While this ruling temporarily quelled an otherwise raging initial coin offering (ICO)… Read More »
Drowned out by yet another busy news cycle last week were Acting Comptroller of the Currency Keith Noreika’s remarks at a fintech conference held at the Federal Reserve Bank of Philadelphia. However, these comments should not be overlooked, as they have the potential to upend the banking industry in this country by tearing down the… Read More »
2017 has been the year of cryptocurrency – with Bitcoin, Ethereum and other popular digital currencies experiencing unprecedented growth. Bloomberg recently reported that the price increase in Bitcoin and Ethereum (respectively 358 and 4000 percent) has been “staggering” considering “[t]ech stocks rose just over 1000 percent over the entire course of their [late-’90s] bubble.” As… Read More »
Initial Coin Offerings (also referred to as “ICOs” or “token sales”) are presenting new challenges for regulators in determining the application of securities laws. Until recently, the ICO market was unrestrained by law or regulation; inhibited only by investor appetite. But last month, the Securities and Exchange Commission (SEC), threw cold water on the ICO… Read More »
This post is inspired by and includes excerpts from “The Rise of Robo-Advisers: Can an Algorithm be a Fiduciary”, 67 Duke L.J (2017) (forthcoming). Imagine all your retirement savings is managed by an online company (robo-adviser) that utilizes an extremely sophisticated machine learning algorithm to construct a continuously adjusting portfolio designed to maximize risk-adjusted returns… Read More »
Earlier this month, Aaron Klein from the Brookings Institution, and Brian Knight from the Mercatus Center, penned an op-ed in which they argued that the OCC should be willing to allow a certain amount of failure amongst fintech firms who receive a special purpose national bank charter. Their logic is that failure is an ethos… Read More »
In his book Stress Test, former Treasury Secretary Tim Geithner vividly describes the difficulty he encountered in trying to get the various federal financial regulators to go along with the Obama administration’s post-crisis regulatory reform agenda. In the summer of 2009, after the Treasury Department released the details of their proposal, regulators swarmed Capitol Hill… Read More »
