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)
We all hope STOs (Security Token Offering) in US take off and there is promise they might… we’ll have to wait and see. I personally think for STOs to succeed our regulations will have to get a little relaxed. EG- The costing and time required to do a Reg A+ Tier 2 creates a huge friction point for most founders (lawyers charging $100K- $500K to do a Reg A+). If this friction can be reduced, there is more light at the end of the tunnel.
At the end of the day the win happens where the investor wins (No ICO scams)
At present I see a divided world drawing lines between Utility and Security ICOs.
Do ICO or STOs stand the test of time? Who wins? Time will tell…
NOTE: This article is provided for informational purposes only and should not be construed as legal or tax advice.