In 2018, the number of US Securities and Exchange Commission (SEC) authorized initial coin offerings (ICOs) increased significantly. These ICOs legally sold securities to large-scale investors, reports MarketWatch on 11 January.
The SEC’s Electronic Data Gathering, Analysis, and Retrieval system (EDGAR) was used by MarketWatch to compile the data. They searched some keywords in the above-mentioned system. These keywords included: coin, token, ICO, and initial coin offering. As reported, they found 287 results for the ICO fundraisings which were approved by the commission. The companies were allowed to sell the securities under the Form D immunity.
A short registration form used by the company to disclose the prospective investor’s information in its securities issuance is known as Form D. This form can be filed even after 15 days of the first token sale. Moreover, the form is significantly shorter in length as compared to the reports that are required before the sales of non-exempt security to US investors.
The exempted securities can only be sold to the accredited investors. The accredited investors may include individuals having a net worth of more than USD 1 million, those having a consistent yearly income of more than USD 200,000 or enterprises having assets worth more than USD 5 million.
According to the media reports, the ICOs registered in 2018 under Form D have a combined declared value of USD 8.7 billion. Moreover, the Form D registrations reached the maximum (99) in the second quartile of 2018. On the other hand, 87 companies were registered in the first quartile, followed by 53 and 48 in the third and the fourth quartile, respectively.
Recently, the SEC officially announced the cryptocurrencies to be the top examination priority for the year 2019. Nevertheless, the regulation of cryptocurrencies is still one of the toughest in the world.
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