It’s not just national-level securities regulators that are keeping a close eye on initial coin offerings (ICOs).

Late last month, the North American Securities Administrators Association (NASAA) – an organization composed of local, state and regionally based markets watchdogs in Canada, Mexico and the United States – published its Enforcement Report for 2017. While primarily an overview of the kinds of enforcement actions taken in the past year and the issues facing securities regulators, it notably contains a section on the blockchain use case.

After noting that NASAA members believe that trading around cryptocurrencies in general “is likely to pose a significant risk to investors,” it makes note of the growing interest in ICOs, which can be used to bootstrap and fund new blockchain networks but have also served as vehicles for alleged fraud in the past.

The report states:

“Cryptocurrencies purport to store value in a distributed digital ledger, and are currently very popular as a means of raising capital for very early stage startups (usually referred to as an “Initial Coin Offering” or ICO). NASAA members are closely watching this emerging market.”

That statement came amid a growing number of pronouncements from securities regulators worldwide, a trend that gathered steam after the US Securities and Exchange Commission (SEC) declared that, in some cases, cryptographic tokens distributed through an ICO may be considered securities under federal law.

Some regulators have taken a more restrictive approach, including those in China and South Korea. In the case of China, market watchdogs declared that the ICO funding model is an illegal form of financing, triggering a wave of platform closures and refunds for projects that were in the middle of soliciting funds.

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