Valerie Szczepanik, who is the United States Securities and Exchange Commission Advisor for Digital Assets and Innovation stated that all the exchanges who want to list initial exchange offering (IEO) tokens for a fee might find themselves in regulatory trouble. Szczepanik has shared details during the Consensus 2019 Conference on May 13. 

Currently, they are required to follow the registration and licensing requirements for broker-dealers, alternative trading systems (ATS) or security exchanges. And if they don't follow it, they are going to face legal trouble, as per Szczepanik.

Mentioning IEO, Szczepanik who is also known as "crypto czar" claimed that the exchanges wanting to list IEO tokens for a fee and attract buyers for an issuer are mostly falling into broker-dealer activity. She added, 

“If they are not registered they will find themselves in trouble in the U.S. if they have a U.S. issuer or U.S. buyers if they are operating on the U.S. market.”

Szczepanik later declared about the earlier case brought by the SEC in September 2018 against TokenLot, a crypto broker-dealer directed by Lenny Kugel and Eli L. Lewitt which marketed itself to be an "ICO Superstore" mentioned that "it was instructive in this regard."

She said, 

“This was a platform that was assisting to bring buyers to ICOs [...] In that case, there was an enforcement action charging the platform with acting as an unregistered broker-dealer and participating in the distribution in violation of the registration provisions.”

During that time, the SEC's claimed that the Kugel and Lewitt broke the law by not registering their business in the country. TokenLot accepted to pay $471,000 fine, however, doesn't admit or deny the findings.

Szczepanik hasn't mentioned any of the particular exchanges. But, Binance, OKEx, and KuCoin are among the exchanges which have initiated IEOs, and these transactions are hoped to produce millions of dollars in fees for such platforms. 

The most popular platform for IEOs is Binance's Launched, which in January organized a public sale of the BitTorrent tokens, collecting $7.4 million in file-sharing service owned by Tron.