Poloniex says nine altcoin tokens including Augur (REP) and Decred (DCR) will no longer be available on its platform to traders in the U.S. The cryptocurrency exchange says the move is due to lack of clarity about whether the country’s Securities and Exchange Commission (SEC) views these tokens are securities or utilities.
Poloniex Delists Augur, Decred, Seven Others from US Trading
The Circle-owned exchange platform announced the decision via a statement issued on Thursday (May 16, 2019). According to the statement, beginning from Wednesday (May 29, 2019), users in the U.S. will no longer be able to trade the affected tokens.
The geofenced tokens as listed by the platform are Ardor (ARDR), Bytecoin (BCN), Decred (DCR), GameCredits (GAME), Gas (GAS), Lisk (LSK), Nxt (NXT), Omni (OMNI), and Augur (REP). an excerpt from Thursday’s announcement reads:
“Today’s action is a result of regulatory uncertainty in the US market. Specifically, it is not possible to be certain whether US regulators will consider these assets to be securities. We understand how frustrating this choice is for our customers, and for the crypto community more broadly.”
Despite the geofencing, U.S. customers of Poloniex who are bag holders of the affected tokens can withdraw them as long as the platform continues to list those tokens for other jurisdictions. Poloniex also advised U.S. traders on its platforms who trade those tokens to close all such positions before the May 29 deadline.
Jeremy Allaire, the CEO of Circle – owners of Poloniex, also expressed frustration at the course of action. He blamed the SEC for failing to adopt policies that created an enabling environment for cryptocurrency development in the U.S.
Altcoins Dying Out or STOs Taking Over?
For its part, the SEC has consistently maintained that many initial coin offering (ICO) tokens are securities and should be subject to the appropriate regulations. Most token issuers counter with the claim that their tokens are utilities that allow holders access to specific blockchain-based platforms.
Since 2017, the SEC has taken a hard-line stance on ICOs indicting many projects as being unregistered securities offerings. This move has in some way led to the emergence of security token offerings (STOs) which many commentators say stand better chances of scaling through regulatory roadblocks.
For STO token issuers, the steps being taken by regulators in places like the U.S. and Thailand only serves to enforce the legitimacy of their fundraising models. Thailand’s SEC recently announced regulatory amendments that would allow STO issuance in the country’s primary market.
With STOs taking center stage, there is the belief that ICO tokens may become phased out given the current hostile regulatory climate. Different analysts in the industry have predicted that many of the over 2,000 altcoins might not survive for much longer.
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