The Securities and Exchange Commission (the “SEC”) recently sent a warning to the burgeoning market for initial coin offerings (“ICOs”): assets that exist only on the blockchain may be securities subject to registration, anti-fraud and other requirements under the U.S. federal securities laws. The outcome of the SEC’s analysis was unsurprising, representing a reasonably straightforward application of longstanding securities law principles. However, the SEC’s discussion left several key questions and potential paths forward for ICO issuers and other participants in the ICO marketplace to consider.
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Pamela L. Marcogliese
The OCC’s New FinTech National Banking Charter
By Michael H. Krimminger, Pamela L. Marcogliese, Daniel Ilan, Hugh C. Conroy, Jr. & Sandra M. Rocks on
Posted in Regulatory, United States
On December 2, 2016, Comptroller Thomas J. Curry of the Office of the Comptroller of the Currency (“OCC”) announced that the OCC will move forward with chartering financial technology (“FinTech”) companies that offer bank products and services and meet the OCC’s chartering requirements. However, while encouraging, the announcement, and the OCC paper released with it, left many issues unresolved.
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Bitcoins and Blockchain – The Use of Distributed Ledger Technology for the Issuance of Digital Securities
By Pamela L. Marcogliese & Mark B. Rotter on
Posted in SEC Guidance
Overstock.com, Inc. (“Overstock”) recently filed a shelf registration statement with the Securities and Exchange Commission (the “SEC”) allowing for the issuance of “digital securities.”[1] The SEC declared that registration statement effective on December 9, 2015. The digital securities described in Overstock’s registration statement will be evidenced only by entry into a publicly distributed ledger and transfers of the digital securities can only be effected on that ledger. They will not be evidenced by physical certificates or notes, recorded in book-entry system of the type typically used by issuers and transfer agents today, traded through a traditional securities exchange or cleared through an established clearing system. Instead, ownership of digital securities and trades will be reflected in a publicly distributed proprietary ledger maintained by an alternative trading system (“ATS”) run by Pro Securities LLC using the technology of tØ, a subsidiary of Overstock. In June 2015, Overstock completed the first placement of corporate bonds in the form of digital securities pursuant to Rule 506(c) of Regulation D using the technology of tØ.
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