Nearly 300 Initial Coin Offerings Used the Form D System to Receive SEC Approval

As regulatory agencies are becoming more active in the cryptocurrency and blockchain space, it seems that seems that some Initial Coin Offering (ICO) projects are trying to be more compliant with the U.S. Securities and Exchange Commission (SEC).

Around 300 ICO projects have been approved by the SEC back in 2018 according to a report from Market Watch. It seems that the regulatory agency in the United States approved 287 projects last year.

These companies that were trying to launch an ICO did not offer it to the general public. Indeed, they offered it to accredited investors by the U.S. SEC. Accredited investors are those that have a net worth of at least $1 million or that had an income of $200,000 during the last two years.

Companies can file a simple ‘Form D’ with the regulatory agency. Once the company is approved, interested accredited investors are able to place their funds in the company. This is very important for companies that wan to raise funds since this allows them to have access to more than 12.4 million accredited investors in the U.S.

The SEC has been trying to regulate the cryptocurrency and ICO market during 2018. Indeed, it started issuing enforcement actions against different ICOs that were launched to the market. For example, Paragon and Airfox had to give investors their funds back and also pay a $250,000 fine for selling unregistered securities.

In the future, the SEC could release new regulations for the crypto space and for ICOs. During the last few months, the number of initial coin offerings has been decreasing due to the increased control by the SEC and other institutions in the world.

Around the world, other regulatory agencies are also trying to have a more active role in the crypto space. The main intention is to avoid scammers and fraudulent companies to harm retail investors.

Publication date: 
01/12/2019 - 06:10