If you were looking for a safe blockchain investment and had the chance to invest in the “first licensed and regulated tokenized cryptocurrency exchange and index fund based in the U.S.” and audited by a Big 4 accounting...more
Private companies in the gig economy like Uber, Airbnb and GrubHub would love to issue compensatory equity to their platform participants, just like they’re able to do with their employees. ...more
9/26/2018
/ AirBnB ,
Capital Markets ,
Equity Securities ,
Exemptions ,
Gig Economy ,
JOBS Act ,
Offerings ,
Privately Held Corporations ,
Registration Requirement ,
Regulatory Oversight ,
Regulatory Standards ,
Rule 701 ,
SEC Comment Letter Process ,
Securities and Exchange Commission (SEC) ,
Securities Regulation ,
Sharing Economy ,
Venture Capital
If you’re thinking of airdropping free tokens or implementing a cryptocurrency bounty program, be careful. The Securities and Exchange Commission just issued a cease and desist order (the “Order”) with respect to an initial...more
8/20/2018
/ Cryptocurrency ,
Digital Currency ,
Enforcement Actions ,
Financial Markets ,
Initial Coin Offering (ICOs) ,
Regulatory Oversight ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Token Sales ,
Unregistered Securities ,
Virtual Currency
t’s not often that the House of Representatives votes nearly unanimously on anything noteworthy these days, but that’s exactly what the House did on July 17 in voting 406-4 for the “JOBS and Investor Confidence Act of...more
7/24/2018
/ Accredited Investors ,
Angel Investors ,
Capital Formation ,
Capital Raising ,
Crowdfunding ,
Early Stage Companies ,
Equity Markets ,
Financial Regulatory Reform ,
General Solicitation ,
JOBS Act ,
Legislative Agendas ,
Offerings ,
Proposed Legislation ,
Regulation D ,
Securities and Exchange Commission (SEC) ,
Special Purpose Vehicles ,
Venture Capital
On June 28, 2018, the Securities and Exchange Commission issued a release amending the definition of “smaller reporting company” (“SRC”) to expand the number of reporting companies eligible for relaxed or scaled disclosure....more
7/16/2018
/ Accelerated Filers ,
Attestation Deadlines ,
Auditors ,
Disclosure Requirements ,
Executive Compensation ,
Financial Regulatory Reform ,
Regulation S-X ,
Regulatory Oversight ,
Regulatory Requirements ,
Securities and Exchange Commission (SEC) ,
Smaller Reporting Companies ,
State and Local Government
“Can a digital asset that was originally offered in a securities offering ever be later sold in a manner that does not constitute an offering of a security?”
...more
Buried in new legislation mainly intended to ease Dodd-Frank restrictions on small banks is an expansion of Regulation A eligibility to include SEC reporting companies. ...more
6/11/2018
/ Capital Formation ,
Corporate Issuers ,
Dodd-Frank ,
Economic Growth Regulatory Relief and Consumer Protection Act ,
Financial Regulatory Reform ,
Form S-3 ,
Initial Public Offering (IPO) ,
New Legislation ,
Publicly-Traded Companies ,
Regulation A ,
Reporting Requirements ,
Securities and Exchange Commission (SEC)
Initial coin offerings so far have gone through two major phases in their brief lifespan. The initial phase flew under the regulatory radar in an explosion of deals that raised billions of dollars seemingly overnight and...more
5/7/2018
/ Accredited Investors ,
Bitcoin ,
Cryptocurrency ,
Digital Currency ,
Disclosure Requirements ,
Emerging Growth Companies ,
Form S-1 ,
Initial Coin Offering (ICOs) ,
JOBS Act ,
Pooled Investment Vehicles ,
Real Estate Investments ,
Registration Statement ,
Token Sales ,
Virtual Currency
The Wall Street Journal ominously reported on February 28 that the Securities and Exchange Commission recently issued dozens of subpoenas to initial coin offering issuers and their advisors demanding information about the...more
Dual or multi-class capitalization structures generally allow companies to sell large amounts of shares to the public while maintaining control in the hands of the founders and early investors. Popularized by the Google IPO...more
A recent report on the state of Regulation Crowdfunding published by a major crowdfunding advisory firm is cause for both celebration and renewed reform efforts. The $100 million aggregate funding milestone and the prorated...more
Last month, Secretary of the Commonwealth of Massachusetts William Galvin made good on his promise to conduct an exam sweep of ICOs in Massachusetts. On January 17, the Enforcement Section of the Massachusetts Securities...more
2/5/2018
/ Cryptocurrency ,
Digital Currency ,
Enforcement Actions ,
Financial Crimes ,
Initial Coin Offering (ICOs) ,
Investment ,
Popular ,
Regulatory Oversight ,
Securities Violations ,
Unregistered Securities ,
Virtual Currency
What happens when corporate directors approve their own awards under an equity incentive plan? Under Delaware law, so long as the plan is approved by a majority of the fully informed, uncoerced and disinterested stockholders,...more
1/11/2018
/ Board of Directors ,
Business Judgment Rule ,
Business Litigation ,
Compensation & Benefits ,
Controlling Stockholders ,
Corporate Officers ,
DE Supreme Court ,
Discretionary Functions ,
Employee Incentive Plans ,
Entire Fairness Standard ,
Executive Compensation ,
Fiduciary Duty ,
Incentive Awards
December 11, 2017 was a day of reckoning for entrepreneurs conducting or contemplating initial coin offerings, and for securities professionals who advise them. ...more
12/18/2017
/ Blockchain ,
Capital Raising ,
Cease and Desist Orders ,
Digital Currency ,
Distributed Ledger Technology (DLT) ,
Enforcement Actions ,
Financial Markets ,
Initial Coin Offering (ICOs) ,
Popular ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Token Sales ,
Unregistered Securities ,
Virtual Currency
Bloomberg reported on October 16 that over $3 billion dollars have been raised in over 200 initial coin offerings so far this year. It remains to be seen whether the pace of ICOs will slow down in the face of regulatory...more
A recent Delaware Chancery Court decision provides important guidance on what types of defective corporate acts may be ratified under Section 204 of the Delaware General Corporation Law (the “DGCL”), and what types may not....more
Cornell Tech celebrated a historic milestone today with the dedication of its new campus on Roosevelt Island in New York City. A collaboration of Cornell University (yes, my law school) and The Technion – Israel Institute of...more
On August 1, 2017, Delaware became the first state to allow corporations to record issuances, transfers and ownership of stock using blockchain technology. The amendments were passed by the Delaware State Senate and House of...more
On July 25, 2017, the SEC’s Division of Enforcement issued a Report of Investigation (the “Report”) that concluded that the tokens issued in an initial coin offering (“ICO”) by a decentralized autonomous organization called...more
Since 2014, many private company mergers and acquisitions intermediaries have chosen not to register as broker-dealers. That’s because a 2014 SEC no-action letter took the position that intermediaries that limited their...more
On June 8, 2017, the House of Representatives passed the Financial CHOICE Act of 2017 on a vote of 233-186. Congress loves acronyms, and here “CHOICE” stands for Creating Hope and Opportunity for Investors, Consumers and...more
6/26/2017
/ Consumer Financial Protection Bureau (CFPB) ,
Crowdfunding ,
Dodd-Frank ,
Emerging Growth Companies ,
Financial Regulatory Reform ,
Form D Filing ,
Pending Legislation ,
Regulation D ,
Regulatory Oversight ,
Sarbanes-Oxley ,
Securities and Exchange Commission (SEC) ,
Small Offering Exemptions
Venture capital funds routinely negotiate for a right of redemption – the right to require the company to buy out their shares after a certain period of time if an exit has not occurred – as a key element of their exit...more
Every founder of a growth startup dreams of a big, successful exit — a sale of the company for millions of dollars. But that dream could be shattered if the investors are able to cause the company to be sold prematurely with...more
On March 22, the Subcommittee on Capital Markets, Securities, and Investment of the Financial Services Committee conducted a hearing entitled “The JOBS Act at Five: Examining Its Impact and Ensuring the Competitiveness of the...more
The just completed IPO of Snap Inc. has received enormous buzz and plenty of press coverage, mostly about its eye-popping valuation and offering proceeds, the big winners among the founders and early investors and the...more
3/7/2017
/ Capital Raising ,
Emerging Growth Companies ,
Financial Institutions ,
Financial Markets ,
Initial Public Offering (IPO) ,
Investment ,
JOBS Act ,
Sarbanes-Oxley ,
Share Class Structures ,
Snapchat ,
Social Media ,
Voting Rights