Jay Clayton, chairman of the U.S. Securities and Exchange Commission (SEC), said Tuesday that he doesn’t see a pathway to a cryptocurrency ETF approval until concerns over market manipulation are addressed.

“How that [manipulation] issue gets addressed, I don’t have a particular path. But it needs to be addressed” before an ETF gets approved, Clayton remarked during CoinDesk’s Consensus: Invest conference.

“The prices retail investors are seeing are the prices they should rely on, and free from manipulation – not free from volatility, but free from manipulation,” Clayton said during his appearance, which was moderated by investor Glenn Hutchins. Clayton also remarked that custody concerns also remain an issue ahead of any kind of ETF approval.

The SEC chairman – who clarified at the outset that he was speaking in a personal capacity, and not on the part of his agency – also honed in on the question of whether the sale of tokens during initial coin offerings (ICOs) constitute securities offerings.

“If you finance a venture with a token offering, you should start with the assumption that it is a security,” he remarked.

Still, Clayton conceded that in some instances, the status of a particular token isn’t as clear-cut. When the topic of distributed ledger startup Ripple and the digital asset XRP was raised, Clayton said that “some of these questions require a lot of information” without going further into that specific topic.

On the other hand, “many are very obvious,” according to Clayton. “I’m selling you my token, I’m going to go off and produce a venture and, hopefully, you’ll get a return for having purchased that token.”

Clayton also offered a bit of advice for those looking to pitch tokens to potential investors: “If there’s a gap between what you’re telling [the SEC] and what you’re telling people investing in your venture, that’s not a good place to start.”

The SEC chairman was also asked about the recent announcement that two different crypto startups, both of which conducted ICOs, settled registration violation charges with the agency. While noting that those firms are working with the SEC, Clayton clarified that the settlements were made in the context of those specific companies.

“People should understand that this was the remedy in this particular case but remedies in future cases may be different,” said Clayton, adding: “Get your act together.”

Clayton’s remarks fit into the wider picture of the SEC’s actions in the crypto space to date, beginning with its July 2017 release of the so-called DAO report, which outlined how some token sales, in the agency’s view, could be considered securities offerings.

While some startups sought to bypass securities laws entirely by dubbing their offerings utility tokens, Clayton has noted that the token sale’s behavior is how it may be classified. He used the concept of a laundry token, noting that a token used to wash clothes would not be a security.

“But if I have a set of 10 laundry tokens and the laundromats are to be developed and those are offered to me as something I can use for the future and I’m buying them because I can sell them to next year’s incoming class, that’s a security,” he said in April.

Photo by Stan Higgins for CoinDesk

Editor’s Note: This article has been updated to reflect that Clayton also indicated that custody concerns are part of the SEC’s consideration of any crypto ETF approval.