Are Bad Actors Checks Required For Security Token Offerings (STOs)?

Bad Actor checks are mandatory for anyone doing a Security Token Offering (STO) on Regulations D506c, Regulation S or Regulation A+. This is an important anti-fraud and due diligence requirement to ensure disqualified persons do not raise funds.

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U.S. Turns the Corner on Security Tokens (STOs)

Congressman Warren Davidson of Ohio (R) began a pivotal process in the cryptocurrency world by writing legislation that will address all of the ambiguity that now exists in the US laws governing tokens.

Everyone knows of the confusion and flaws of the SEC ’s application of regulations created for equity shares being applied to tokens, forcing all coins to be classified as security tokens whether they are actual financial instruments or utility tokens. The enforcement of these regulations can be extremely severe and even criminal. [...] 

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Is Regulation Hurting Blockchain Innovation in the U.S.?

I with Silicon Valley entrepreneurs every day. Here’s what I’m finding:

Token Offerings are moving out of the U.S. Forward thinking countries like Malta, Switzerland, Germany, France, Australia, and Japan are creating laws enabling utility tokens to be floated in a legally compliant manner.

Here in the USA, there is no utility provision and all token offerings are considered securities. This is hurting our companies and innovation is leaving the US. While we have had successful Reg D 506c token offerings offerings, I am yet to see one successful Reg A+ offering for a blockchain based token sale (successful Reg A+ offerings have mostly been consumer products) [...] 

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Can an ICO do token Airdrops to U.S residents?

BrightCOIN’s legal counsel wrote a really good article on the matter. The high-level takeaway is- DO NOT do Airdrops to American residents. Anil Advani from Inventus Law said “Founders, therefore, have to be careful in structuring their Airdrop or free stock giveaway offerings because those will very likely be: (a) treated as issuance of securities; and (b) subject to the Securities Act, and subject to registration or a specific exemption under the Act.” Full article here 

The content (Blogs, FAQs, News) posted on BrightCOIN may contain incorrect information, always get professional advice. Neither BrightCOIN nor any of its directors, officers, employees, representatives, affiliates or agents shall have any liability whatsoever arising from any error or incompleteness of fact or opinion in, or lack of care in the preparation of, any of the materials posted on this website. BrightCOIN does not provide legal, accounting or tax advice. Any representation or implication to the contrary is expressly disclaimed. [...] 

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