In a blogpost dated September 10th 2019, Blockstack announced that its SEC-qualified token offering has ended. More than 4,500 investors— including retail investors in the US— participated in the offering which raised over $23 million.
Blockstack’s Reg A+ Token Offering Explained
Just two months ago, Blockstack announced that it had
received SEC approval to launch the first-ever Reg A+ token offering.
The SEC’s Reg A+ exemption allows an issuer to raise up to $50
million from both accredited and non-accredited investors.
Now, the world’s first SEC-qualified token offering— which
was open to retail investors— has come to a close.
According to a statement from Blockstack,
“For the first time, retail investors in the United States were able to participate in a token offering qualified by the SEC. More than 4,500 individuals and entities participated in the 2019 token offerings. Blockstack PBC has entered into agreements for more than $23M in these offerings (including both our SEC-qualified token offering and our offering to investors outside the United States made under Regulation S).”
Investors included Union Square Ventures, Lux Capital,
Recruit Holdings, Arrington Capital, Hashkey Group, Fenbushi Capital, Frontier
Ventures, Spartan Group, and other funds.
Blockstack also noted that it strategically targeted investors from Asia, which may result in an additional $5 million through either a separate private placement or a follow-on SEC-qualified offering.
Blockstack held a Reg D offering back in 2017, which was restricted to wealthy accredited investors. Yet one of the company’s goals was to widen the path of investment opportunity to non-accredited investors. Blockstack said,
“We’re proud to deliver on our commitment to permit early community members who tried participating in 2017 but did not reach the wealth or income requirements for “Accredited Investor” status. These early community members were able to participate now at the same price as the 2017 Regulation D offering to Accredited Investors.”
The Reg A+ is one SEC-compliant method of raising funds through
from Initial Coin Offerings (ICOs), the Security Token Offering (STO)
explicitly declares itself a securities offering, and therefore must abide by
its jurisdiction-appropriate laws and regulations as established by the
applicable governing body. In the United States, this body is the Securities
and Exchange Commission (SEC).
Previously, SEC Chairman Jay
Clayton has noted that virtually every ICO he has seen, minus
Ethereum, constitutes a securities offering.
As a result, ICOs
have seen a significant decrease, while STOs
continue to grow.
Security tokens— just like Blockstack’s— have been used to
compliantly raise capital with real-world assets including equity,
estate, and even fine
Some predict the Reg A+ to
play a crucial role in the accelerated adoption of security tokens.
What do you think about Blockstack raising $23 million
after a token offering through the SEC’s Reg A+? Let us know what you think in
the comments section below.
Image courtesy of Blockstack.