# kaal:claim:3606663-005

**Claim.** The assumption by ICO issuers that token sales let them circumvent securities registration and disclosure requirements proved to be a fallacy for many U.S. issuers, who faced increased SEC enforcement actions in late 2019.

**Type.** failure  **Support.** argued

**Holds when.**

- U.S. issuers of tokens in ICOs
- post 2017 enforcement environment

**Source quote.**

> Of course, for many U.S. issuers of tokens in ICOs this presumption became in retrospective a fallacy that should haunt them in the aftermath of increased SEC enforcement actions of ICOs in late 2019.

**From.** Kaal, *Digital Asset Market Evolution* (2020), 2. Initial Coin Offerings, page 14

**Cite as.** Kaal, Digital Asset Market Evolution (2020). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3606663

**Verify.** sha256 of source PDF `d1d4a15a293b715bb6a5a32e689f59c3a1587915039ba9a1cf4eeb8ee2a1e57c` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202020%20-%20Digital%20Asset%20Market%20Evolution.pdf

**Failure mode.** regulatory avoidance presumption collapses under enforcement  (family: regulatory-arbitrage)

**Topics.** securities-law, compliance, regulatory-failure, decentralization

**Keywords.** ico, securities-regulation, sec-enforcement, regulatory-arbitrage, disintermediation

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