Initial Product Offerings (IPO), are regulated by the SEC. The Securities Act of 1933 requires companies to open their books to the public and registering the securities they wish to sell with the SEC. The Act has two main functions; to require that investors receive the financial information concerning the securities and to prohibit fraud in the sale of securities. 
The Securities Exchange Act of 1934 regulates the trading markets and requires compliance with ongoing SEC reporting obligations.
Public companies are also regulated by the Sarbanes-Oxley Act of 2002. The Oxley Act seeks to prevent corporate fraud. It created the Public Company Accounting Oversight Board.
Although it’s a digital market, specific facts may determine that the ICO is a security and fall under the SEC jurisdictions. To date, no ICO has been registered with the SEC as a security. However, companies issuing ICO may be required to file a regulation D exception with the SEC. The regulation D exception which will allow them to sell the ICO without the need to register as a security with the SEC. Companies who do not file a regulation D exception may be subject to fines and other punishments by the SEC.
The primary regulatory concern for ICOs in the lack of regulations. By the nature of blockchains, ICOs are designed to be market regulated with minimal third-party oversight. However, the SEC does give some oversight on dealing with ICO to prevent fraud and promote healthy investment opportunities.