US Regulatory Climate Continues to Be Hazy for ICOs

The US Congress continues to pass business-friendly legislation, but many in the cryptoasset space complain that ambiguities in federal securities laws will prevent initial coin offering issuers (ICOs) from taking advantage of them. Last week, the House of Representatives passed the Regulation A+ Improvement Act of 2017, which seeks to implement a 50 percent increase to the amount of capital that small companies can raise through securities offerings that are much less robust than the traditional initial public offering (IPO) route pursued by large firms.

If the bill passes the Senate and is signed into law by President Trump, companies pursuing Regulation A+ securities offerings will be allowed to raise up to $75 million and accept some investments from retail investors.

Unfortunately, industry observers warn that blockchain startups seeking to raise capital through ICOs may not be able to take advantage of this business-friendly regulatory climate due to ambiguities in how this nascent fundraising model fits into a nearly century-old legal framework.


Share this: