On July 26, 2023, the U.S. Securities and Exchange Commission (“SEC”) adopted new rules specifying enhanced disclosure regarding cybersecurity risk management, strategy governance, and incident disclosure. The SEC first proposed new cybersecurity rules back in March 2022. The agency’s comments to the final rule suggest greater disclosure and improved consistency of disclosures will benefit investors. Several of the key aspects of the final rules are outlined below, and ultimately will probably be navigable for organizations with meaningful incident response and evaluation experience as well as robust risk management programs which already include and evaluate cybersecurity.Continue Reading SEC Issues Final Cybersecurity Rules Enhancing and Modifying Disclosure Requirements: Companies will want to Measure Twice and Cut Once
New SEC guidance provides some clarity for digital asset issuers
On April 3, 2019, the U.S. Securities and Exchange Commission (SEC) took their first step towards providing greater clarity on the key question of how to evaluate whether transactions involving issuance or sales of digital tokens are sales of securities subject to U.S. securities laws and regulations.
The guidance was released in two parts:
Risks and considerations when storing crypto-assets
Following the sudden death of its co-founder and CEO, Gerald Cotten, in December 2018, Quadriga, Canada’s largest cryptocurrency exchange, is unable to gain access to about $145 million of bitcoin and other digital assets. Quadriga reports that Cotton stored the digital assets in a “cold wallet” on his encrypted laptop and repeated attempts by his
Federal Court deals SEC a setback in Blockvest ICO litigation
On November 28, 2018, the U.S. Securities and Exchange Commission’s (SEC) request for a preliminary injunction against Defendants Blockvest, LLC (Blockvest) and Blockvest’s founder and chairman Reginald Buddy Ringgold, III (Ringgold) was denied by United States District Court for the Southern District of California.
Blockvest and Ringgold were offering and selling unregistered securities in the
SEC settles two ICO enforcement actions
The U.S. Securities and Exchange Commission (SEC) recently settled two initial coin offering (ICO) enforcement actions grounded on the sale of unregistered securities. The two settlements, one with CarrierEQ Inc. (or AirFox) and the other with Paragon Coin Inc., are the first time the SEC has imposed civil penalties on companies solely for offering digital
Anticipating Risks From and Responding to Cryptocurrency Theft
On November 20-21, 2017, Tether, the company behind USDT, a digital token backed by fiat currencies like the dollar and euro, disclosed that a hack resulted in the loss of $30.95 million worth of tokens. The Tether hack illuminates the privacy, reputational, financial and recovery risks associated with issuing, owning and storing digital currencies. These
SEC Securities Trading Suspension for Three Blockchain- Related Companies
Digital tokens are now being incorporated into federal and state regulatory regimes. Over the past two weeks, the Securities and Exchange Commission (“SEC”) has suspended the trading of company securities of three publicly-traded blockchain-related companies The first company to be suspended was CIAO Group, Inc. (“CIAU”) due to questions regarding the accuracy of statements pertaining