On May 13, while speaking at the Consensus 2019 blockchain conference in New York City, Valerie Szczepanik — who is the Advisor for Digital Assets at the U.S. Securities Exchange Commission (SEC) — stated that platforms listing initial exchange offerings (IEOs) in exchange for fees could find themselves in trouble with the agency.

Szczepanik, who is also known as the SEC's "Crypto Czar," said that if a platform receives money from an IEO issuer in order to provide them with buyers for their tokens, they could effectively be engaging in what is considered by the agency a broker-dealer activity.

She went on to say that, if these platforms do no register as broker-dealers, they will be running afoul of U.S. security laws if either the issuer or any buyer is based in the United States, or if the platform itself is operating in the United States.

In September of last year, Eli L. Lewitt and Lenny Kugel started TokenLot, which billed itself as a superstore for initial coin offerings (ICOs). Szczepanik says that, because the platform was helping ICO issuers find buyers for their tokens, they were, in essence, acting as a broker-dealer. For this reason, the SEC charged the company with being an unlicensed broker-dealer.

Eventually, the company agreed to settle the case and pay the SEC a fine that was close to $500,000, though they never publicly admitted nor denied the charges against them.

Last month, the SEC released what they called a framework, which was created by both Szczepanik and William Hinman, who is the Director of the Division of Corporation Finance at the SEC. The framework is an analytical tool that guides ICO issuers and other issuers of digital assets in determining if their particular digital asset is, in fact, an investment contract, which would mean that it would be considered a security under U.S. law and hence would be bound by the country's security laws.

In the past, Szczepanik has also indicated that those involved in the ever-expanding stablecoin market could also run afoul of the SEC because of possible violations of federal securities laws.