Key takeaways

• On November 8, 2017, SEC Chairman Jay Clayton reiterated that the risks posed by virtual tokens are a priority of the SEC and that certain tokens will be treated as securities subject to federal securities laws and regulations.
• The Enforcement Division of the SEC has established a new Cyber Unit designed to investigate emergent issues relating to distributed ledger technologies.
• Following the SEC’s DAO Report, the SEC has shown a willingness to pursue token issuers who present a risk to participants.