As someone whose generally bearish on crypto currencies, I do see one clear benefit to ICOs over traditional exchanges. Namely the fact that you can trade them 24 hours a day, 7 days a week, from anywhere in the world with an internet connection, in any currency (theoretically) and on no fixed exchange (although it's likely that the number of exchanges will be limited to reduce price instability).

> you can trade them 24 hours a day, 7 days a week, from anywhere in the world with an internet connection, in any currency (theoretically) and on no fixed exchange

This describes securities, generally. You and I can transact to trade shares of Uber in renminbi on a Saturday. We can transact, over the counter and using a broker, to trade shares of Apple in Canadian dollars the following day. The Apple trade would need to be reported to the national ticker, for transparency purposes, but that’s about it.

We concentrate public equity trading into fixed windows and currencies to increase liquidity. It’s a convenience. Privately-negotiated trading is still common for large blocks of public securities.

The obvious difference is transactions without a third party. You can also verify ICO token integrity on the blockchain yourself (via open source apps).

The obvious question is whether that actually matters all that much for securities, since the broker/exchange adds negligible risk and overhead for the buyer relative to the trust in the public company needed to buy a stake in it and the costs of meeting regulatory requirements for public companies.

Anybody who's more worried by the potential complications of T+2 settlement when purchasing blue chip stocks than the Wild West world of ICOs shouldn't be investing.

That is indeed the right question to ask.

Maybe it's less about trust and more about permission. With token based securities I could trade with whomever I choose whenever I want.

Interesting to see how it turns out in the end.

What happens if a trade that is illegal under the law of the country of the seller/buyer/exchange? The courts would be completely powerless to undo the transaction. Again it seems to me the main and only attraction is evading regulation.

And you can maintain custody, so somebody isn't loaning out your shares.

There's a 95% accurate O(1) solution to determine if an ICO transaction has integrity.

You can trade pretty much any security 24/7 these days, and people do.

Many futures exchanges are open 24 hours on weekdays (perhaps with 15 minute gaps), but not weekends. Can you link to one that's open on the weekends?

Practically any retail/spot forex exchange I thought?

you just described the FX derivatives market, which btw cannot work without regulation and enforcement and monitoring bodies with real consequences for bad actors.

I haven't seen an FX exchange that trades through weekends, since Oanda stopped offering weekend trading back in 2012.[1] Can you link to one?

1. https://www.leaprate.com/news/oanda-suspends-weekend-trading...

Recently congress members have written to the SEC asking for clarity on crypto: https://www.chepicap.com/en/news/4016/15-members-of-congress...

They want to draft legislation for regulatory clarity. So we can be sure ICO's will be addressed in that.

I was really pessimistic about security tokens because no exchange could legally trade them, but now a few exchanges are getting certified so it may be possible to dump these tokens. How many buyers there will be is still in question.

Malta have very well defined laws about ICO's on the books from November 1st, the UK and USA have been disasterously vague about guidance for what constitutes a security so far, which doesn't help anyone except the bankers.

I think the issue of what constitutes a security is very well defined in the US...it’s just no one has framed their token in such a way it’s not a security (despite all the claims to the contrary) and otherwise the ICOs have not complied with securities laws because...well move fast break things.

I’m not sure why a company doesn’t just come out and do an ICO: a) with a token that’s not a security or b) a token that is a security and comply with securities laws.

> a token that is a security and comply with securities laws

Because if you do that, there's no point having an ICO. Just do an IPO - the token is an expensive, pointless distraction from their mission to democratize the world's dogsitters, or whatever they want to do.

> Just do an IPO

A token is virtually frictionless and costs nothing to setup or trade globally, dividends can be paid out directly to token owners.

An IPO is an incredibly lengthy, arduous process requiring a small army of lawyers and accountants simply to offer shares to a restricted subset of sophisticated investors in one country.

You are referring to an STO and not an ICO.

Because the only reason for tokens is to create a little confusion that allows people to think they'll be allowed to violate securities laws.

They have, see https://coinlist.co/

If your innovation requires a new monetary system, it is probably a Ponzi.

No they haven't. They've said from the beginning that if it looks like a security, smells like a security, walks like a security and talks like a security, then it's a security.

It's people trying to play the, "Well, it's different cause it's on a computer!" game that are muddying the waters.

That's my impression too.

Emily Post had this great rant on how people act like every new technology is exempt from the rules. Her examples at the time was the cellphone in movie theaters. Everybody knew not to talk loudly in the movie theater before the arrival of cellphones, but suddenly plenty of people thought it was ok to a) have a ringing phone, and b) answer it. Eventually everybody got it together again and nobody does that anymore. People figured out how to generalize politeness for the new technology.

It seems like the same deal here. Investment regulation applies when you're selling a piece of your operation. It still will.

The scale of filesharing was irreversibly expanded by the internet, and in particular, by BitTorrent. Some technologies fundamentally change the difficulty of enforcing prohibitions against particular types of activity.

If the analogy you're drawing is mp3s to money, it's not a good one. Money has been digital much longer than music; SWIFT was formed in 1973. [1] The MICR E13B font, the machine-readable numbers seen at the bottom of every check, was adopted as a standard in 1958. [2]

Further, since cryptocurrency's use in actual commerce is a rounding error, I don't think cryptocurrencies are even at the mp3 level yet. To be useful to most people, cryptocurrencies need to be turned into real money, which makes enforcement easy enough. It's especially easy here, in that ICOs are big public launches.

Really, anything taking significant amounts of money from non-accredited investors needs to be quite public, because individually they don't have much money. Which again, makes enforcement easy. And also makes it clearly under the domain of the SEC unless they are careful to exclude American investors.

[1] https://en.wikipedia.org/wiki/Society_for_Worldwide_Interban...

[2] https://en.wikipedia.org/wiki/Magnetic_ink_character_recogni...

No I was making a more general point: that technology can fundamentally and irreversibly change the relationship between people and the government, resulting in certain classes of laws becoming easier or harder to enforce.

Did this general point have some relevance to the discussion? If not, I would like to take this opportunity to point out that water is generally wet, and that food can fundamentally taste good.

It's directly relevant to your point that technology has a honeymoon period of being exempt from the rules before the rules adapt to reimpose the previously in place controls. I was saying that's not the universal progression.

again, the only place ICO would be safe is those under the rule of Russia or China, otherwise all other countries face extradition to the US.

US has proven again and again they will touch anyone anywhere (except china and russia), and its a losing battle to go up against an organization that has unlimited resources with capabilities that grow constantly.