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SEC chairman talks cryptocurrencies

Clayton speaks at Stanford University's Rock Center for Corporate Governance. Photo: Justin Sullivan/Getty Images

"What I see happening in the ICO market today is ‘let me have all of the disclosure freedom of a private placement and all of the secondary activity and ability to market this of a public offering.' We decided in 1934: that [having both of these at once] led to a lot of problems," SEC Chairman Jay Clayton said on Wednesday evening at Stanford University.

Why it matters: With the boom in initial coin offerings and blockchain technology, it's not surprise that the U.S. Securities and Exchange Commission is watching the space closely, and is especially concerned with the lack of protections for investors.