SEC Chairman Jay Clayton has issued a broad warning to companies and individuals trying to “cash in” on the market frenzy surrounding Bitcoin and other cryptocurrencies. His prepared remarks at the Securities Regulation Institute in Washington D.C. on January 22 suggest that the SEC’s Enforcement Division is focused on abusive actors in the cryptocurrency marketplace. These remarks and similar recent remarks were followed on anuary 24 by a joint Op-Ed in the Wall Street Journal with CFTC Chairman J. Christopher Giancarlo promoting the same themes.

In his speech, Chairman Clayton expressed concern that securities lawyers were giving bad advice when they tell clients that unregistered ICOs are generally legal. Clayton also cautioned issuers that it would be inappropriate if a company marketed itself in connection with cryptocurrencies or distributed ledger technology with the sole purpose of promoting its own securities. He warned that companies with no legitimate experience or expertise with cryptocurrencies or ICOs (“initial coin offerings”) cannot merely “cash in” by issuing a press release.