Professor Edward Zelinsky's article on Law360, focuses on the case of James Dawson and Elaine Dawson v. Dale W. Steager, West Virginia State Tax Commissioner.
Attorneys who intentionally misadvised clients or failed to advise disclosure that a token was a security to investors could be fined, according to an article on Bloomberg's Big Law Business and Professor Aaron Wright thinks these lawyers may be at risk of malpractice. “I can’t imagine this will end pretty for our sector. It could be pretty gruesome," he commented.
There’s disagreement in the ICO advisory community over how to properly comply with securities laws. The “Simple Agreement for Future Tokens,” or SAFT, has been promoted as a way to satisfy SEC regulations and facilitate investments. The SAFT was developed to help mitigate compliance risks associated with the ICO model, but not everyone agrees that it's the right answer. The Bloomberg Big Law Business article continues, "The Cardozo Blockchain Project, a Cardozo Law School initiative that examines cryptocurrency legal issues, in November published, 'Not So Fast – Risks Related to the Use of a ‘SAFT’ for Token Sales,' a report saying the agreement 'rests on a fundamentally flawed interpretation of U.S. securities laws.'”
For the complete article, visit Bloomberg Big Law Business.