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US Signals Liberalization of Fundraising Rules

1059 Days ago

In the news, The United States Securities and Exchange Commission (SEC) has signaled it wants to enable ordinary investors to invest in non-stock exchange listed companies. This and other news from South Korea & India as well.

Georgetown, Cayman Islands, Sept. 08, 2018 (GLOBE NEWSWIRE) -- The United States Securities and Exchange Commission (SEC) has signaled it wants to enable ordinary investors to invest in non-stock exchange listed companies. SEC Chair Jay Clayton told the Wall Street Journal that the Commission is considering liberalizing rules for non-accredited investors, who are defined as individuals with a net-worth of less than $1 million or who have an annual income of less than $200,000.

Clayton’s comments reflect the falling number of publicly traded companies and the fact that many of the most exciting tech companies remain privately funded for many years before any possible Initial Public Offering (IPO). The Chair commented that it’s important to ask “who is participating" in funding the highest growth companies. In many cases, critics allege, it is a small circle of Wall Street institutions and Silicon Valley funds who get their pick of the most exciting startups. A survey by McKinsey said that 91% of investors believe private markets generate better returns than public assets.

Meanwhile, Initial Coin Offerings (ICOs) collected over $11bn in the first half of 2018, with US citizens and residents largely excluded from supporting such projects due to the SEC rules.

Dima Zaitsev, ICOBox PR Director: The SEC’s comments are welcome as investing in the hottest startups shouldn’t be reserved for just a “chosen few.” The SEC has an important role to play in preventing fraud and market manipulation but shouldn’t bar people from making their own investment decisions just because they, for example, “only” make $199,000 per year. Cryptocurrencies and decentralized networks are democratizing finance and technology but the US has until now seemed content to lag behind the rest of the world.

South Korea to Pave the Way for Wider Public Blockchain Implementation

The Korea Internet & Security Agency (KISA) has just announced its plans to double the number of blockchain trials in the public sector in 2019, bringing them up to 12. The agency also signaled its intent to support privately-built blockchain projects in the country. The 2019 blockchain pilot budget will be increased to more than 10 billion Korean won, or $9 million, which will be allocated in addition to the $9 million earmarked for both 2018 and 2019.

The South Korean government has also announced its plans to train several dozen highly skilled blockchain professionals who will act as a support resource for startups aiming to enter the blockchain market.

Daria Generalova, ICOBox co-founder: Naturally, this is fantastic news! It confirms the Korean government's continued commitment to developing the already burgeoning national blockchain economy. And they are certainly putting their money where their mouths are: over the course of the next year alone, the government's investment in blockchain and related innovative technologies is expected to surpass $4.4 billion. Things are really moving there, I can't wait to see what kind of amazing creativity will come out of it. Step aside, world: South Korea is on a roll!

High Fives for India’s Official Cryptocurrency Study Tours

While some countries have decided to stick their heads in the sand over cryptocurrency and blockchain technology in recent weeks, India certainly cannot be diagnosed with ostrich syndrome any time soon. The country has progressively started to move more and more toward embracing cryptocurrencies, ICOs, and blockchain. According to their 2017-18 Annual Report, the Securities and Exchange Board of India (SEBI) organized tours to the US, Japan, and Switzerland last year specifically so officials could study cryptocurrencies and initial coin offerings (ICOs) and how those countries are dealing with them.

There’s still some trepidation around the technology in general in India—the RBI recently got its knuckles rapped by their Supreme Court for ending dealings with crypto businesses—but overall there’s been really positive movement in the sector. No matter how the situation surrounding cryptocurrency market regulation in India turns out, no one will be able to accuse the county’s officials of not at least giving it all they've got.

Daria Generalova, ICOBox co-founder : There are two ways you can react to the introduction of technologies that are new, perhaps seemingly opaque, and not yet fully understood in the mainstream. The first and easiest is to gainsay them and retreat into your shell and make a hundred arguments about why your conventional, old-fashioned system is best. The second is to greet innovative ideas with an open mind and really check them out, try them on for size, take them out for a serious test drive. I wholeheartedly applaud SEBI’s choice to send its officials to learn about cryptocurrencies and ICOs from their colleagues in other countries with an eye to adopting the technology. India’s move here is setting a world class example for everyone else.

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