Jared Marx is an attorney at Washington, DC law firm Harris, Wiltshire Grannis. He advises companies about bitcoin-related regulatory law and represents companies and individuals in civil and criminal proceedings.
Here, he discusses why a new securities ruling is a potential boon for ‘crypto 2.0’ and ‘bitcoin 2.0’ companies operating in the US.
The new rules give businesses in the blockchain ecosystem an avenue to get financial backing from the best-educated investors out there: their users.
I wrote last week about the challenges that ‘bitcoin 2.0’ companies face from the squishy definition of a “security” under US law. These new rules don’t resolve that ambiguity, but they do create a low-cost safe harbor for businesses that want to avoid uncertainty (and possible criminal exposure) by simply treating their token sales as sales of securities.
Here’s how it works: prior to these rules, a company could generally sell securities only to wealthy individuals or after going through expensive registration with the SEC.
Now, companies can file a mini-registration statement with the SEC and then sell