{"id":453,"date":"2019-04-11T11:25:46","date_gmt":"2019-04-11T09:25:46","guid":{"rendered":"https:\/\/advokatskafirmasajic.com\/blog\/?p=453"},"modified":"2019-04-22T11:29:00","modified_gmt":"2019-04-22T09:29:00","slug":"law-keeping-up-with-technology-8","status":"publish","type":"post","link":"https:\/\/advokatskafirmasajic.com\/blog\/law-keeping-up-with-technology-8\/","title":{"rendered":"Law \u2013 keeping up with technology"},"content":{"rendered":"\n

ICO and Bitcoin, some specificities<\/strong><\/p>\n\n\n\n

The modern world, with varying degrees of\ndevelopment of countries, i.e. states, can be described as a paradoxical place\nin which on the one hand there is a struggle for minimum decent living\nconditions of a human being, while on the other hand technology offers\nopportunities that we could hardly imagine – digitization is currently marching\nwith huge steps. As we have already mentioned in the earlier texts related to blockchain,\nICO and crypto-currencies, in this text we will address some other aspects that\nhave also attracted our attention, with the intent to continue to monitor all\nthese phenomena from the legal point of view.<\/p>\n\n\n\n

In the previous text we dealt with the issue of\nICO and the legal status of the same \u2013 whether it can they be considered as\nsecurities (classically speaking, bearing in mind the traditional definition) as\nwell as how certain countries treat this phenomenon. What arises from the\nvarious positions of the states that have declared themselves in relation to\nICO is a conclusion that on the question on whether the ICO is permitted it can\nbe answered \u2013 perhaps it is. The grey zone that arises in the circumstances of\nthe ICO and the crypto-currency is the one that suits them, but of course, it\nintroduces certain doubts and uncertainties, at least from the point of view of\nmost average people. However, the attitude of regulators in the United States\nis quite interesting, in particular the USA\nSecurities and Exchange Commission (SEC),<\/em> according to which federal\nsecurities laws apply to those who offer and sell securities in the United\nStates, regardless of the fact whether the issuer is a traditional company or a\ndecentralized autonomous organization, then regardless of whether the\nsecurities are purchased by US dollars or virtual currencies and finally\nregardless of the fact whether they are distributed in a certified form or\nthrough a distributed ledger<\/em>[1]<\/a>\ntechnology.<\/p>\n\n\n\n

According to the position of the US Securities\nCommission, issuers of tokens in relation to the distributed ledger or\nblockchain technology must register the offer and sale of such securities, except\nin cases where there are valid exceptions otherwise they are liable for breach\nof the law. The purpose of such a registration is to ensure that investors are provided with necessary information and\nprotection by the regulator. The innovative technology that stands behind these\nvirtual transactions does not relieve the supply of securities and trading\nplatforms from a regulatory framework designed to protect investors and market\nintegrity. Interestingly, ICO’s tokens are designated as securities, but the\nstatus of Ether is vague. Here it is necessary to point to the so-called Howey test<\/em>, which serves for the purpose\nof determining whether some transactions are considered securities. Namely,\ndeciding in the Howey<\/em> case, the\nSupreme Court has established a test that deals with the substance of the\ninvestment, and not with its form, as a decisive factor in determining whether\nit is a security. Even if an investment is not designated as shares, stocks or\nbonds, it can be a security in accordance with the law, and therefore subject\nto to certain registration requirements. This is the case with ICO tokens.<\/p>\n\n\n\n

The legal regulation gradually takes a step\nwith galloping technology, trying not to react sharply and falls into its own\ntrap of definitions and regulations, and in this way its slow progress still creates\na flexible market and so called a grey zone. In this grey zone, there are some\nunwanted sides of these technologies. Thus, Ransomware<\/em>\nis also a type of malicious software that denies the user access to the computer\nand requires the payment in order to remove placed restrictions, where the payment\nis required in Bitcoins, a suitable market for prohibited substances, and the\npossibility of unauthorized access. Definitely, blockchain technology is the\nsafest but no secure technology. However, who and what in this world do not\nhave defects?
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[1]<\/a> A technology that binds to a blockchain and implies a decentralized database<\/p>\n\n\n\n

Author: Milica Karadza<\/p>\n\n\n\n

E-mail: milica@afsajic.com<\/p>\n\n\n\n

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Law – keeping up with technology<\/a><\/blockquote>