Can I raise money through an initial coin offering (ICO) without violating securities laws in Connecticut? What are the requirements?

Requirements for Conducting an Initial Coin Offering (ICO) in Connecticut

Connecticut has not yet enacted specific legislation or regulations regarding the conduct of initial coin offerings (ICOs). However, ICOs may be subject to federal securities laws, including registration requirements under the Securities Act of 1933 and the Securities Exchange Act of 1934.

According to the U.S. Securities and Exchange Commission (SEC), whether an ICO involves the offer and sale of securities depends on the facts and circumstances of the offering, including the economic realities of the transaction. If the ICO involves the offer and sale of securities, the issuer must comply with the federal securities laws, including registration requirements, unless an exemption applies.

Therefore, if you plan to conduct an ICO in Connecticut, you should consult with a securities attorney to determine whether your ICO involves the offer and sale of securities and whether any exemptions from registration are available.

Exemptions from Registration

The SEC provides several exemptions from registration under the Securities Act of 1933 that may be available for ICOs, including:

• Regulation D: This exemption allows issuers to offer and sell securities to accredited investors without registration.
• Regulation A+: This exemption allows issuers to offer and sell up to $50 million of securities in a 12-month period without registration.
• Regulation Crowdfunding: This exemption allows issuers to offer and sell securities to the general public through crowdfunding platforms without registration, subject to certain limitations.

To qualify for these exemptions, the issuer must comply with certain requirements, such as providing disclosure documents to investors and filing notice with the SEC.

Conclusion

In summary, Connecticut has not yet enacted specific legislation or regulations regarding the conduct of ICOs. However, ICOs may be subject to federal securities laws, including registration requirements under the Securities Act of 1933 and the Securities Exchange Act of 1934. If you plan to conduct an ICO in Connecticut, you should consult with a securities attorney to determine whether your ICO involves the offer and sale of securities and whether any exemptions from registration are available.

Jurisdiction

Connecticut

• General