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

Initial Coin Offerings (ICOs) and Securities Laws in South Dakota

If you are considering raising money through an initial coin offering (ICO) in South Dakota, it is important to understand the state’s securities laws.

According to the North Dakota Securities Department, which has been actively investigating ICOs and cryptocurrency-related investments, ICOs may be considered securities and subject to registration requirements under state and federal securities laws [2]([4]).

Therefore, if you plan to offer tokens or coins through an ICO in South Dakota, you may need to register the offering with the South Dakota Division of Securities or qualify for an exemption from registration requirements [1]([1]).

The South Dakota Division of Securities provides a list of exemptions from registration requirements, including exemptions for offerings to accredited investors, offerings with a limited number of purchasers, and offerings with a minimum investment amount [1]([1]).

It is important to note that the requirements for ICOs may vary depending on the specific facts and circumstances of each offering. Therefore, it is recommended that you consult with a qualified securities attorney to ensure compliance with all applicable securities laws [1]([1]).

Conclusion

In summary, if you are considering raising money through an ICO in South Dakota, you may need to register the offering with the South Dakota Division of Securities or qualify for an exemption from registration requirements. It is recommended that you consult with a qualified securities attorney to ensure compliance with all applicable securities laws.

Source(s):
Jurisdiction

South Dakota