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

Requirements for Raising Money through an ICO in Hawaii

To raise money through an initial coin offering (ICO) in Hawaii without violating securities laws, you must comply with the registration requirements of the Securities Act of Hawaii. The Act requires that all securities offerings in Hawaii be registered with the Hawaii Department of Commerce and Consumer Affairs (DCCA) Securities Enforcement Branch, unless an exemption is available .

To determine whether an exemption is available, you must analyze whether your ICO involves the offer and sale of securities. The SEC has provided a framework for analyzing whether a digital asset is a security [2]. If your ICO involves the offer and sale of securities, you must comply with the registration requirements of the Securities Act of Hawaii or qualify for an exemption.

The Hawaii Securities Act provides several exemptions from registration, including the intrastate exemption, the private placement exemption, and the crowdfunding exemption . To qualify for the intrastate exemption, you must ensure that the offer and sale of securities are made only to residents of Hawaii and that the issuer is a Hawaii-based company . To qualify for the private placement exemption, you must ensure that the offer and sale of securities are made only to accredited investors . To qualify for the crowdfunding exemption, you must comply with the requirements of the federal JOBS Act and the Hawaii Uniform Securities Act .

Conclusion

To raise money through an ICO in Hawaii without violating securities laws, you must comply with the registration requirements of the Securities Act of Hawaii or qualify for an exemption. To determine whether an exemption is available, you must analyze whether your ICO involves the offer and sale of securities. If you are unsure about the requirements for raising money through an ICO in Hawaii, you should consult with a securities attorney.

Source(s):
Jurisdiction

Hawaii