Blockstack ICO Breakthrough With SEC

A general term in the cryptocurrency world is ICO — Initial Coin Offering. ICO has discredited cryptocurrency in variety of ways, especially with the inability of some projects to live up to expectations of the investors.  

Today, Blockstack is not coming onboard with just a whitepaper ICO. This is because the US Securities and Exchange Commission (SEC) have certified the company to go public with its first approved non security token sale.

According to WSJ (Wall Street Journal) report on Wednesday, the SEC has cleared Blockstack’s crypto sale for its Initial Coin Offering which is powered by a SEC regulated company, Regulation A+.

A Tough Road to Approval

Regulation A+ is an initiative aimed at supporting business start-ups that wants to go public with their shares. IPO is difficult to get approval of and it is more intrusive on businesses, which is why startups prefer ICO. With the Regulation A+ onboard, the strict laws on utility token approval have been reduced, even though Blockstack didn’t find it easy getting approval from SEC.

Reports say that the firm may have spent up to $2 million in the quest. It is hoping to raise $28 million in sales from its token. Anthony Pompliano in a tween reported on the development:

“HERE WE GO!@blockstack was just approved by the SEC to hold the first regulated token offering under Reg A+.
Finally non-accredited investors can participate in investments that previously were only open to the rich.
The laws need to change, but this is next best thing.”

This is a positive development at a time that there have been concerns that the SEC is coming down hard on regulation of initial coin offerings. The accomplishment of the Blockstack team is indicative that there is a path that could lead to approval for utility token sales if the proper approach is taken by teams.

Blockstack’s tokens will serve as a precedence for other cryptocurrency startups thinking of the right approach to get SEC’s nod.

A Decentralized Computer Network

Muheeb Ali and Ryan Shea, owners of Blockstack actually waited for 10 months to get this approval . Through Regulation A+, Blockstack created a procedural code to run a special type of ICO which is regulated by the SEC and now it has been cleared for the token sale.

Katherin Wu, in another tweet wrote:

“Taking this step shows that there is at least one way of legally compliant token funding and distribution methods here in the U.S. There was no doubt a lot of hard work behind the scenes communicating to the SEC on the finer points of a token sale.”

The approval by SEC means that the ICO would be open to the public unlike the usual restricted sales meant for qualified investors. Blockstack describes itself as a “decentralized computer network”.

 

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Zoran SpirkovskiZoran Spirkovski

Author: Zoran Spirkovski

Copywriter, Freelance Journalist, Blockchain Enthusiast. Writing about Crypto since 2016. Loves to travel and experience different cultures. Highly ambitious and with an ever-increasing attraction towards quality work, products, services, and experiences. You can find him on Telegram where he has been known to spend his time making friends, and doing business. @ZoranSpirkovski

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