SEC Gets Tough on Blockchain Jargon

Last week, two exchange traded funds designed to be plays on blockchain technology debuted. Thing is the Amplify Transformational Data Sharing ETF (NYSEARCA: BLOK) and the Reality Shares Nasdaq Blockchain Economy ETF (NASDAQ: BLCN) do not have the term “blockchain” in their names and that is the way the Securities and Exchange Commission (SEC) wants it.

The SEC is taking a hard line against companies revealing new interest in blockchain.

“A number of firms in recent months have made waves by announcing that they are shifting to blockchain business ventures, including a firm previously dedicated the sale of iced tea,” reports CoinDesk. “And while those announcements have often sparked price increases, the trend itself has sparked warnings from both the agency as well as groups like FINRA as one potentially ripe for abuse by would-be fraudsters. In statements issued earlier today during an event in Washington, D.C.”

A blockchain is a decentralized database shared across all users that facilitates the process of recording transactions and tracking assets across a business network. This foundational technology is expected to pave the way for significant disruptions across many industries.