I think it is funny, how everybody talks about how great blockchain is and that they want their country to be leading in blockchain technology. But on the same note, they think Bitcoin and Altcoins are useless and should be banned.
- A blockchain doesnt work without a tangible coin or token, because there would be nothing too lose to attack the blockchain. Therefore there would be no trust or not more than those of a fractinal reserve central bank system.
- ICOs and the hype around it provide plenty of easy funding for a lot of ideas. A lot will fail, but some will succeed. And traditional fundings wouldnt given so many projects a chance.
What do I take from it? I believe it is true, that they all want to be leading in blockchain technology. However this works only with decentralized solutions and a tangible asset like a coin or token which can be traded for real money. If they overregulate it in the US, business will move to more friendly environments like Japan, Singapore, Switzland or the EU. And if this happens, they might adjust their approach to regulation.
I do hope for "crypto securities", because I dont think todays security laws could effectively regulate this industry without killing the development in that country. Regarding short term prices, going down the wrong lane, would be certainly not good for prices.
I actually am not sure if point 2 you make is positive. While many more projects have a chance due to this new funding mechanism, the quality of even the better projects is usually worse than the equivalent start-up. Start-ups have to go through a serious grind, and I mean really serious, to even get a dime of funding. They have to make plans, understand their business model, pitch it to investors, etc.
This process refines the product offering and makes it much better than it would be otherwise if they could just directly raise capital with all the benefits of both public offerings and private placements. I tend to think regulations on ICOs, if done appropriately, could formalize the process more and actually lead to a better overall quality of projects entering the space (even if it is far fewer). You will have to be far "hungrier" to get through the process. The question mark is whether or not those regulations go too far.