Set regulations for initial coin offerings — or the US may fall behind, says a crypto trader
- The U.S. may fall behind other countries if the SEC doesn't establish regulations for ICOs, says cryptocurrency trader Ran Neu-Ner.
- Entrepreneurs and investors are going to other countries, where regulations are more favorable and tax breaks are better, to establish their businesses.
- "My fear is that the U.S.A. may actually be falling behind," Neu-Ner says.
Crypto trader Ran Neu-Ner told CNBC that the U.S. Securities and Exchange Commission needs to establish ICO (initial coin offerings) regulations — or risk stifling an entire American industry.
"My fear is that the U.S.A. may actually be falling behind," Neu-Ner said on "Fast Money" Thursday evening.
Neu-Ner, who is host of CNBC Africa's "Crypto Trader" and the founder of OnChain Capital, has traveled extensively to places like Singapore and Japan, where he said ICOs, a crowdfunding way to raise funds for cryptocurrency ventures, are thriving.
"I know [the SEC is] balancing investor protection with the need to grow an industry," said Neu-Ner, an early investor of cryptocurrency like bitcoin.
But many entrepreneurs are establishing companies in places like Singapore and the European island nation of Malta, places that offer better tax incentives, Neu-Ner warned.
The SEC has long been cautious of ICOs, which are a still unregulated way of raising money. About $600 million has been raised by way of fraudulent ICOs, according to the SEC. On Wednesday, the commission set up a website to teach investors what a fake ICO looks like.
"The SEC did adopt a responsible approach by taking their time to see what's happening with the industry," Neu-Ner said. "But now we know crypto is real. We know this thing, that blockchain and crypto, isn't going away anytime soon. And now they've got to come to the party and give us some kind of regulation so we know where we stand."