Instructor: Roger Royse, Founder of Royse Law Firm
Course Title: The Business Basics of Blockchain, Cryptocurrencies, and Tokens
Location: Stanford Continuing Studies
Week: 7 (of 7)
The seventh session will examine legal issues in blockchain applications. We will discuss the legal structure of an initial coin or security coin offering (ICO) in the US and globally, including the rules governing the sale of securities in the US. We will overview patent and intellectual property (IP) issues in blockchain and licensing agreements that provide protection to inventors while making resources available for open innovation.
Instructor: Roger Royse, Founder of Royse Law Firm
Course Title: The Business Basics of Blockchain, Cryptocurrencies, and Tokens
Location: Stanford Continuing Studies
Week: 4 (of 7)
This class will shift will focus on the promise of smart contracts to provide cheap verification, reduce costs and automate many routine transactions. We will explain what a smart contract is (and what it is not), how it works and discuss where it can be implemented to the current economy. We will discuss the use of distributed applications built on the block chain and examine how Ethereum allows dApps to run. We will also look in depth at several dApps including Cryptokitties, Augur and Local Ethereum.
Instructor: Roger Royse, Founder of Royse Law Firm
Course Title: The Business Basics of Blockchain, Cryptocurrencies, and Tokens
Location: Stanford Continuing Studies
Week: 3 (of 7)
The third session focuses specifically on cryptocurrencies. We will discuss the history of digital currencies from Bitcoin to Ether and others. We will review core concepts and terms and more highlight the major events in cryptocurrency space, new opportunities and existing problems that remain to be solved.
Regulation of Bitcoins under Indian Regulatory FrameworksNishtha Sharma
This presentation provides a comprehensive account of meaning of Bitcoins, their intended use, mechanism behind the payment through peer to peer transaction system alonwith an overview on the means or heads under which Bitcoins can be regulated under Indian regulatory regime
The regulation for any new area is better than its ban. Shying away from framing regulation to deal with a new technology does not prove the efficiency of the Government.
Instructor: Roger Royse, Founder of Royse Law Firm
Course Title: The Business Basics of Blockchain, Cryptocurrencies, and Tokens
Location: Stanford Continuing Studies
Week: 4 (of 7)
This class will shift will focus on the promise of smart contracts to provide cheap verification, reduce costs and automate many routine transactions. We will explain what a smart contract is (and what it is not), how it works and discuss where it can be implemented to the current economy. We will discuss the use of distributed applications built on the block chain and examine how Ethereum allows dApps to run. We will also look in depth at several dApps including Cryptokitties, Augur and Local Ethereum.
Instructor: Roger Royse, Founder of Royse Law Firm
Course Title: The Business Basics of Blockchain, Cryptocurrencies, and Tokens
Location: Stanford Continuing Studies
Week: 3 (of 7)
The third session focuses specifically on cryptocurrencies. We will discuss the history of digital currencies from Bitcoin to Ether and others. We will review core concepts and terms and more highlight the major events in cryptocurrency space, new opportunities and existing problems that remain to be solved.
Regulation of Bitcoins under Indian Regulatory FrameworksNishtha Sharma
This presentation provides a comprehensive account of meaning of Bitcoins, their intended use, mechanism behind the payment through peer to peer transaction system alonwith an overview on the means or heads under which Bitcoins can be regulated under Indian regulatory regime
The regulation for any new area is better than its ban. Shying away from framing regulation to deal with a new technology does not prove the efficiency of the Government.
Doing Business of Cryptocurrency w.r.t. India Legal PerspectiveEquiCorp Associates
Cryptocurrency has been called as the greatest technological breakthroughs since the Internet. However, a parallel warning from the Reserve Bank of India as a caution against bitcoin and other cryptocurrency, with no guidelines or order to prohibit cryptocurrency may puzzled you to ponder over –Is it legal to do business of cryptocurrency in India? There may be several questions which you may encounter w.r.t. applicable laws of India, as there are no specific guidelines issued by any Government Authority including Reserve Bank of India or Ministry of Finance.
The main stream adoption of cryptocurrency is becoming a reality despite sceptics who compare the boom to the 1636 tulip mania. The issue is not whether cryptocurrency will survive, but rather how it will evolve. The article aims to clarify certain major aspects which may be encountered for- “Doing Business of Cryptocurrency w.r.t. Indian Legal Perspective” under the evolving legal structure.
Instructor: Roger Royse, Founder of Royse Law Firm
Course Title: The Business Basics of Blockchain, Cryptocurrencies, and Tokens
Location: Stanford Continuing Studies
Week: 2 (of 7)
The second class will describe the underlying blockchain technology and explain key concepts such as block, hash, blockchain, mode, nonce, distributed and decentralized ledgers, mining, tokens, proof of work, and proof of stake. We will discuss how the technology works and the ways that block chain solutions verifies transactions.
As cryptocurrencies become entrenched in the investment world, central banks and others are looking at cryptocurrency investment regulation. The question is, is a cryptocurrency a security, a commodity, or a currency. A major issue for cryptocurrency investment regulation is how to trade bitcoin and others. Are they securities, commodities, or currencies?
https://youtu.be/CROU22FDxGE
Benefits of Investing In Bitcoin in IndiaBTO COINS
However, this method has fewer issues like incompatibility problems between various networks and the high usage cost to access the private network. This is major reasons behind the increasing rise of CRYPTO CURRENCY IN INDIA such as bitcoin.
International Blockchain Conference in Groningen, Nov. 30, 2018Vlad Burilov
The majority of utility token fundraising models (Initial Coin Offerings, ICOs) de facto favor speculation over consumption. The public interest is hence to protect investors’ rights by appli-cation of a new or traditional regulatory regime to such offerings. However, given that ICOs and crypto markets are a globally unregulated phenomenon, direct regulation threatens to stifle innovation and be unenforceable when startups and investors move supply and demand to unregulated markets. This article advocates for a balanced principle-based approach to direct regulation of utility token offerings. Further, the majorly unregulated market of crypto exchanges fuels crypto economy but provides for no gatekeeper’s function: no standardized token listing practices which would cater for commercial viability and innovativeness of the listed startup. Building upon the results of an empirical and case study this article argues that the new inclu-sive governance models applied by crypto exchanges in startup pre-vetting may fill this void.
ASIADIGITALCOIN | ASIA DIGITAL COIN (ADCN) COMPENSATION PLAN Shaikh Amin
Compensation plan of Asiadigitalcoin (ADCN)
Connect with me for starting with ADCN
Shaikh Noorul Amin
Link:http://bit.ly/ADCNregister
Skype:workwithamin
Whataspp:00917350090888
email:workwithamin@gmail.com
The article outlines a number of disadvantages, advantages and advantages of the blockchain today. Also, the types of blockchain are given and how blockchain allows you to organize trade without intermediaries, which can later introduce many services into everyday life and change the way the banking sector works. Mukhammedova Zarina Murodovna "Disadvantages and Advantages of Blockchain" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-5 , August 2021, URL: https://www.ijtsrd.com/papers/ijtsrd46253.pdf Paper URL: https://www.ijtsrd.com/economics/other/46253/disadvantages-and-advantages-of-blockchain/mukhammedova-zarina-murodovna
Blockchain App Factory is a well experienced company that will offer the most reliable cryptocurrency exchange software. Their services include,
White label cryptocurrency exchange platform
Unique cryptocurrency exchange marketing services
Pre and post launch services
Indian approach on bitcoins, cryptocurrencies and blockchain – legal practica...Vijay Dalmia
India does not have any specific laws relating to cryptocurrencies and blockchain, as of now. Indian legal scenario and impact of Indian laws have to be assessed from various statutes which may have applicability on cryptocurrencies like Bitcoin and Blockchain. The presentation deals with these aspects of Indian laws.
European Payment Summit presentation delivered by Nadja van der Veer of PaymentCounsel and Michael Burtscher of Minerva on 15 March 2018.
The presentation explored current issues around the regulation of cryptocurrencies, focusing on the following topics:
Cryptocleansing: how does it work?
Market concerns & regulatory responses
The road to crytpo licensing: learning from New York
Cryptoplatforms: success through compliance
To receive a copy of this presentation by email please get in touch: hello@minervapartnership.eu
Cryptocurrency News India : Is Cryptocurrency Legal In INDIA ? SUPREME COURT ...Bivas Chatterjee
This post discusses in depth various crypto news in India and on whether cryptocurrency legal in India? supreme court on cryptocurrency bitcoin legal, whether Bitcoin or Cryptocurrency is legal in India? This video also discusses on whether we can Invest In Bitcoin in India ? OR Can We Trade In Bitcoin In India?
This video also discusses on the followings:
WHY CRYPTOCURRENCY IS SO POPULAR?
RISK IN CRYPTO – RISK IN BITCOIN - CRYPTO SCAM COINS - CRYPTO NEWS TODAY - CRYPTO NEWS IN INDIA
INNOVATION OF BITCOIN – SATOSHI NAKAMOTO WHITE PAPER – SATOSHI NAKAMOTO IDENTITY
WHAT ARE CRYPTOCURRENCIES?
BITCOIN PRICE PREDICTION – Bitcoin PRICE
HOW THE LAW ENFORCEMENT AGENCY INVESTIGATE BITCOIN ? - WHY HACKERS USE BITCOIN ?
IS IT LEGAL TO INVEST IN BITCOIN OR CRYPTOCURRENCY IN INDIA? - SHOULD YOU INVEST IN CRYPTOCURRENCY?
WHETHER BITCOIN IS LEGAL IN INDIA?
RBI CIRCULAR ON CRYPTOCURRENCY - RBI ON CRYPTOCURRENCY - SUPREME COURT ON CRYPTOCURRENCY
CAN WE INVEST IN BITCOIN ?
CAN WE TRADE IN BITCOIN IN INDIA?
.....This video covers :
IS IT LEGAL TO INVEST I
A cryptocurrency is a digital or virtual currency that is protected by encryption, making counterfeiting and double-spending almost impossible. Many cryptocurrencies are built on blockchain technology, which is a distributed ledger enforced by a global network of computers. Cryptocurrencies are distinguished by the fact that they are not issued by any central authority, making them potentially resistant to government intervention or manipulation.
Cryptocurrency- Intoduction and SignificancesKaran Verma
The world is moving ahead with the advancement of technology and bought various changes in traditional practices just like in the case of transactions via virtual currency which is CRYPTOCURRENCY.
Bitcoin, Block Chain, Cryptocurrency and ICOs: A Legal Perspectiveideatoipo
Block chain, bitcoin and other cryptocurrencies, and ICOs have dominated recent headlines. While excitement continues to grow around this rapidly expanding space, there still seems to be a lot of unanswered questions. Roger Royse, founder of the Royse Law Firm, will discuss the legal issues that may determine the future of these emerging technologies.
Doing Business of Cryptocurrency w.r.t. India Legal PerspectiveEquiCorp Associates
Cryptocurrency has been called as the greatest technological breakthroughs since the Internet. However, a parallel warning from the Reserve Bank of India as a caution against bitcoin and other cryptocurrency, with no guidelines or order to prohibit cryptocurrency may puzzled you to ponder over –Is it legal to do business of cryptocurrency in India? There may be several questions which you may encounter w.r.t. applicable laws of India, as there are no specific guidelines issued by any Government Authority including Reserve Bank of India or Ministry of Finance.
The main stream adoption of cryptocurrency is becoming a reality despite sceptics who compare the boom to the 1636 tulip mania. The issue is not whether cryptocurrency will survive, but rather how it will evolve. The article aims to clarify certain major aspects which may be encountered for- “Doing Business of Cryptocurrency w.r.t. Indian Legal Perspective” under the evolving legal structure.
Instructor: Roger Royse, Founder of Royse Law Firm
Course Title: The Business Basics of Blockchain, Cryptocurrencies, and Tokens
Location: Stanford Continuing Studies
Week: 2 (of 7)
The second class will describe the underlying blockchain technology and explain key concepts such as block, hash, blockchain, mode, nonce, distributed and decentralized ledgers, mining, tokens, proof of work, and proof of stake. We will discuss how the technology works and the ways that block chain solutions verifies transactions.
As cryptocurrencies become entrenched in the investment world, central banks and others are looking at cryptocurrency investment regulation. The question is, is a cryptocurrency a security, a commodity, or a currency. A major issue for cryptocurrency investment regulation is how to trade bitcoin and others. Are they securities, commodities, or currencies?
https://youtu.be/CROU22FDxGE
Benefits of Investing In Bitcoin in IndiaBTO COINS
However, this method has fewer issues like incompatibility problems between various networks and the high usage cost to access the private network. This is major reasons behind the increasing rise of CRYPTO CURRENCY IN INDIA such as bitcoin.
International Blockchain Conference in Groningen, Nov. 30, 2018Vlad Burilov
The majority of utility token fundraising models (Initial Coin Offerings, ICOs) de facto favor speculation over consumption. The public interest is hence to protect investors’ rights by appli-cation of a new or traditional regulatory regime to such offerings. However, given that ICOs and crypto markets are a globally unregulated phenomenon, direct regulation threatens to stifle innovation and be unenforceable when startups and investors move supply and demand to unregulated markets. This article advocates for a balanced principle-based approach to direct regulation of utility token offerings. Further, the majorly unregulated market of crypto exchanges fuels crypto economy but provides for no gatekeeper’s function: no standardized token listing practices which would cater for commercial viability and innovativeness of the listed startup. Building upon the results of an empirical and case study this article argues that the new inclu-sive governance models applied by crypto exchanges in startup pre-vetting may fill this void.
ASIADIGITALCOIN | ASIA DIGITAL COIN (ADCN) COMPENSATION PLAN Shaikh Amin
Compensation plan of Asiadigitalcoin (ADCN)
Connect with me for starting with ADCN
Shaikh Noorul Amin
Link:http://bit.ly/ADCNregister
Skype:workwithamin
Whataspp:00917350090888
email:workwithamin@gmail.com
The article outlines a number of disadvantages, advantages and advantages of the blockchain today. Also, the types of blockchain are given and how blockchain allows you to organize trade without intermediaries, which can later introduce many services into everyday life and change the way the banking sector works. Mukhammedova Zarina Murodovna "Disadvantages and Advantages of Blockchain" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-5 , August 2021, URL: https://www.ijtsrd.com/papers/ijtsrd46253.pdf Paper URL: https://www.ijtsrd.com/economics/other/46253/disadvantages-and-advantages-of-blockchain/mukhammedova-zarina-murodovna
Blockchain App Factory is a well experienced company that will offer the most reliable cryptocurrency exchange software. Their services include,
White label cryptocurrency exchange platform
Unique cryptocurrency exchange marketing services
Pre and post launch services
Indian approach on bitcoins, cryptocurrencies and blockchain – legal practica...Vijay Dalmia
India does not have any specific laws relating to cryptocurrencies and blockchain, as of now. Indian legal scenario and impact of Indian laws have to be assessed from various statutes which may have applicability on cryptocurrencies like Bitcoin and Blockchain. The presentation deals with these aspects of Indian laws.
European Payment Summit presentation delivered by Nadja van der Veer of PaymentCounsel and Michael Burtscher of Minerva on 15 March 2018.
The presentation explored current issues around the regulation of cryptocurrencies, focusing on the following topics:
Cryptocleansing: how does it work?
Market concerns & regulatory responses
The road to crytpo licensing: learning from New York
Cryptoplatforms: success through compliance
To receive a copy of this presentation by email please get in touch: hello@minervapartnership.eu
Cryptocurrency News India : Is Cryptocurrency Legal In INDIA ? SUPREME COURT ...Bivas Chatterjee
This post discusses in depth various crypto news in India and on whether cryptocurrency legal in India? supreme court on cryptocurrency bitcoin legal, whether Bitcoin or Cryptocurrency is legal in India? This video also discusses on whether we can Invest In Bitcoin in India ? OR Can We Trade In Bitcoin In India?
This video also discusses on the followings:
WHY CRYPTOCURRENCY IS SO POPULAR?
RISK IN CRYPTO – RISK IN BITCOIN - CRYPTO SCAM COINS - CRYPTO NEWS TODAY - CRYPTO NEWS IN INDIA
INNOVATION OF BITCOIN – SATOSHI NAKAMOTO WHITE PAPER – SATOSHI NAKAMOTO IDENTITY
WHAT ARE CRYPTOCURRENCIES?
BITCOIN PRICE PREDICTION – Bitcoin PRICE
HOW THE LAW ENFORCEMENT AGENCY INVESTIGATE BITCOIN ? - WHY HACKERS USE BITCOIN ?
IS IT LEGAL TO INVEST IN BITCOIN OR CRYPTOCURRENCY IN INDIA? - SHOULD YOU INVEST IN CRYPTOCURRENCY?
WHETHER BITCOIN IS LEGAL IN INDIA?
RBI CIRCULAR ON CRYPTOCURRENCY - RBI ON CRYPTOCURRENCY - SUPREME COURT ON CRYPTOCURRENCY
CAN WE INVEST IN BITCOIN ?
CAN WE TRADE IN BITCOIN IN INDIA?
.....This video covers :
IS IT LEGAL TO INVEST I
A cryptocurrency is a digital or virtual currency that is protected by encryption, making counterfeiting and double-spending almost impossible. Many cryptocurrencies are built on blockchain technology, which is a distributed ledger enforced by a global network of computers. Cryptocurrencies are distinguished by the fact that they are not issued by any central authority, making them potentially resistant to government intervention or manipulation.
Cryptocurrency- Intoduction and SignificancesKaran Verma
The world is moving ahead with the advancement of technology and bought various changes in traditional practices just like in the case of transactions via virtual currency which is CRYPTOCURRENCY.
Bitcoin, Block Chain, Cryptocurrency and ICOs: A Legal Perspectiveideatoipo
Block chain, bitcoin and other cryptocurrencies, and ICOs have dominated recent headlines. While excitement continues to grow around this rapidly expanding space, there still seems to be a lot of unanswered questions. Roger Royse, founder of the Royse Law Firm, will discuss the legal issues that may determine the future of these emerging technologies.
Initial Coin Offerings – legal requirements and types of tokensEspeo Software
Evaluation of the legal nature of projects funded with ICOs is extremely important to define the legal and tax characteristics of tokens. The legal qualification of a token has practical implications for the legal status of its creator, token trading rules and other entities (buyers of tokens or intermediaries in their trade). Presentation will focus on legal types of tokens, specific requirements for ICO’s promoters and attitude of regulatory authorities towards token crowdsales in individual countries.
Cryptocurrencies are a recent phenomenon that has opened up immense opportunities in all fields of society and life. The reality, however, is that with this digital innovation has come increased scrutiny and concern from both legislators and regulators. Legislators and regulators are now faced with the difficult task of straddling a fine line between ensuring the stability of the global financial system and protecting the interests of investors while avoiding stifling technological innovation.
Private Offering Exemptions and Private Placements (Series: Securities Law Ma...Financial Poise
The private capital markets have become an increasingly important source of funding for both private and public companies alike. Today total capital raised through private placements surpasses total capital raised in public offerings. What’s more, in recent years legislation like the JOBS Act has made a number of significant changes to laws and regulations governing private capital markets. Consequently, understanding the myriad private offering exemptions and how to properly conduct a private placement is crucial for not only for lawyers, but also for executives, managers, directors and anyone involved in corporate finance transactions.
To listen to this webinar on-demand, go to: https://www.financialpoise.com/financial-poise-webinars/private-offering-exemptions-and-private-placements-2020/
CHAPTER 17 Investor Protection and E-Securities TransactionsNe.docxtiffanyd4
CHAPTER 17 Investor Protection and E-Securities Transactions
New York Stock Exchange
This is the home of the New York Stock Exchange (NYSE) in New York City. The NYSE, nicknamed the Big Board, is the premier stock exchange in the world. It lists the stocks and securities of approximately 3,000 of the world’s largest companies for trading. The origin of the NYSE dates to 1792, when several stockbrokers met under a buttonwood tree on Wall Street. The NYSE is located at 11 Wall Street, which has been designated a National Historic Landmark. The NYSE is now operated by NYSE Euronext, which was formed when the NYSE merged with the fully electronic stock exchange Euronext.
Learning Objectives
After studying this chapter, you should be able to:
1. Describe the procedure for going public and how securities are registered with the Securities and Exchange Commission (SEC).
2. Describe e-securities transactions and public offerings.
3. Describe the requirements for qualifying for private placement, intrastate, and small offering exemptions from registration.
4. Describe insider trading that violates Section 10(b) of the Securities Exchange Act of 1934.
5. Describe the changes made to securities law by the Jumpstart Our Business Startups (JOBS) Act and its effect on raising capital by small businesses.
Chapter Outline
1. Introduction to Investor Protection and E-Securities Transactions
2. Securities Law
1. LANDMARK LAW • Federal Securities Laws
3. Definition of Security
4. Initial Public Offering: Securities Act of 1933
1. BUSINESS ENVIRONMENT • Facebook’s Initial Public Offering
2. CONTEMPORARY ENVIRONMENT • Jumpstart Our Business Startups (JOBS) Act: Emerging Growth Company
5. E-Securities Transactions
1. DIGITAL LAW • Crowdfunding and Funding Portals
6. Exempt Securities
7. Exempt Transactions
8. Trading in Securities: Securities Exchange Act of 1934
9. Insider Trading
1. Case 17.1 • United States v. Bhagat
2. Case 17.2 • United States v. Kluger
3. ETHICS • Stop Trading on Congressional Knowledge Act
10. Short-Swing Profits
11. State “Blue-Sky” Laws
“The insiders here were not trading on an equal footing with the outside investors.”
—Judge Waterman Securities and Exchange Commission v. Texas Gulf Sulphur Company 401 F.2d 833, 1968 U.S. App. Lexis 5796 (1968)
Introduction to Investor Protection and E-Securities Transactions
Prior to the 1920s and 1930s, the securities markets in this country were not regulated by the federal government. Securities were issued and sold to investors with little, if any, disclosure. Fraud in these transactions was common. To respond to this lack of regulation, in the early 1930s Congress enacted federal securities statutes to regulate the securities markets, including the Securities Act of 1933 and the Securities Exchange Act of 1934. The federal securities statutes were designed to require disclosure of information to investors, provide for the regulation of securities issues and trading, and prevent fraud. Today, many .
Securities Law: An Overview (Series: Securities Law Made Simple (Not Really)) Financial Poise
Stocks and bonds are easily recognizable as securities, but did you know that promissory notes may also be securities? So can certain joint venture interests and many other types of investment contracts. Then there are cryptocurrency altcoins, which are sometimes securities and sometimes not. How do you identify a security? What are some of the requirements related to offering and selling securities? How do they differ between private and public companies? What happens if you fail to comply with securities laws? How has legislation like the JOBS Act, the FAST Act changed the way in which companies offer and sell their securities? In this webinar our expert panel provides you with a high-level overview of the federal securities laws as well as tangible examples and practical advice in answer to these and many more questions.
To listen to this webinar on-demand, go to: https://www.financialpoise.com/financial-poise-webinars/securities-law-an-overview-2020/
CHAPTER 17 Investor Protection and E-Securities TransactionsNe.docxspoonerneddy
CHAPTER 17 Investor Protection and E-Securities Transactions
New York Stock Exchange
This is the home of the New York Stock Exchange (NYSE) in New York City. The NYSE, nicknamed the Big Board, is the premier stock exchange in the world. It lists the stocks and securities of approximately 3,000 of the world’s largest companies for trading. The origin of the NYSE dates to 1792, when several stockbrokers met under a buttonwood tree on Wall Street. The NYSE is located at 11 Wall Street, which has been designated a National Historic Landmark. The NYSE is now operated by NYSE Euronext, which was formed when the NYSE merged with the fully electronic stock exchange Euronext.
Learning Objectives
After studying this chapter, you should be able to:
1. Describe the procedure for going public and how securities are registered with the Securities and Exchange Commission (SEC).
2. Describe e-securities transactions and public offerings.
3. Describe the requirements for qualifying for private placement, intrastate, and small offering exemptions from registration.
4. Describe insider trading that violates Section 10(b) of the Securities Exchange Act of 1934.
5. Describe the changes made to securities law by the Jumpstart Our Business Startups (JOBS) Act and its effect on raising capital by small businesses.
Chapter Outline
1. Introduction to Investor Protection and E-Securities Transactions
2. Securities Law
1. LANDMARK LAW • Federal Securities Laws
3. Definition of Security
4. Initial Public Offering: Securities Act of 1933
1. BUSINESS ENVIRONMENT • Facebook’s Initial Public Offering
2. CONTEMPORARY ENVIRONMENT • Jumpstart Our Business Startups (JOBS) Act: Emerging Growth Company
5. E-Securities Transactions
1. DIGITAL LAW • Crowdfunding and Funding Portals
6. Exempt Securities
7. Exempt Transactions
8. Trading in Securities: Securities Exchange Act of 1934
9. Insider Trading
1. Case 17.1 • United States v. Bhagat
2. Case 17.2 • United States v. Kluger
3. ETHICS • Stop Trading on Congressional Knowledge Act
10. Short-Swing Profits
11. State “Blue-Sky” Laws
“The insiders here were not trading on an equal footing with the outside investors.”
—Judge Waterman Securities and Exchange Commission v. Texas Gulf Sulphur Company 401 F.2d 833, 1968 U.S. App. Lexis 5796 (1968)
Introduction to Investor Protection and E-Securities Transactions
Prior to the 1920s and 1930s, the securities markets in this country were not regulated by the federal government. Securities were issued and sold to investors with little, if any, disclosure. Fraud in these transactions was common. To respond to this lack of regulation, in the early 1930s Congress enacted federal securities statutes to regulate the securities markets, including the Securities Act of 1933 and the Securities Exchange Act of 1934. The federal securities statutes were designed to require disclosure of information to investors, provide for the regulation of securities issues and trading, and prevent fraud. Today, many .
What We DoIntroductionCreation of the SECOrganization of the.docxmecklenburgstrelitzh
What We Do
IntroductionCreation of the SECOrganization of the SECLaws That Govern the Industry
Introduction
The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.
As more and more first-time investors turn to the markets to help secure their futures, pay for homes, and send children to college, our investor protection mission is more compelling than ever.
As our nation's securities exchanges mature into global for-profit competitors, there is even greater need for sound market regulation.
And the common interest of all Americans in a growing economy that produces jobs, improves our standard of living, and protects the value of our savings means that all of the SEC's actions must be taken with an eye toward promoting the capital formation that is necessary to sustain economic growth.
The world of investing is fascinating and complex, and it can be very fruitful. But unlike the banking world, where deposits are guaranteed by the federal government, stocks, bonds and other securities can lose value. There are no guarantees. That's why investing is not a spectator sport. By far the best way for investors to protect the money they put into the securities markets is to do research and ask questions.
The laws and rules that govern the securities industry in the United States derive from a simple and straightforward concept: all investors, whether large institutions or private individuals, should have access to certain basic facts about an investment prior to buying it, and so long as they hold it. To achieve this, the SEC requires public companies to disclose meaningful financial and other information to the public. This provides a common pool of knowledge for all investors to use to judge for themselves whether to buy, sell, or hold a particular security. Only through the steady flow of timely, comprehensive, and accurate information can people make sound investment decisions.
The result of this information flow is a far more active, efficient, and transparent capital market that facilitates the capital formation so important to our nation's economy. To insure that this objective is always being met, the SEC continually works with all major market participants, including especially the investors in our securities markets, to listen to their concerns and to learn from their experience.
The SEC oversees the key participants in the securities world, including securities exchanges, securities brokers and dealers, investment advisors, and mutual funds. Here the SEC is concerned primarily with promoting the disclosure of important market-related information, maintaining fair dealing, and protecting against fraud.
Crucial to the SEC's effectiveness in each of these areas is its enforcement authority. Each year the SEC brings hundreds of civil enforcement actions against individuals and companies for violation of the securities laws. Typical infr.
Cryptocurrency Crackdown: What You Need to Know about Enhanced IRS/Government...Winston & Strawn LLP
With a newly assembled team of specialized investigators, the Internal Revenue Service (IRS) has dedicated substantial resources to investigating cryptocurrency use in tax evasion. According to the IRS, any taxpayer who has engaged in a virtual currency transaction without properly reporting it has failed to comply with U.S. tax law.
As John Doe Summonses seeking the identities of investors are served on cryptocurrency trading exchanges, significant IRS civil and criminal investigations will ensue. The New York Attorney General’s Office has announced an investigation into the policies and practices of cryptocurrency trading exchanges. The SEC, CFTC, and other regulators have announced initiatives as well.
Winston & Strawn hosted “Cryptocurrency Crackdown: What You Need to Know about Enhanced IRS/Government Scrutiny of Cryptocurrency Transactions.” The program examined the IRS’s newest substantive and procedural initiatives regarding cryptocurrency transactions, the reporting obligations that U.S. taxpayers must follow, corrective steps that may still be taken to mitigate exposure, and appropriate tax structuring of these transactions.
The program also provided an overview of the latest developments in regulatory investigations.
MasterSnacks Cryptocurrency: Legal Issues in Cryptocurrency and BlockchainCitrin Cooperman
If your business is involved in cryptocurrency or Blockchain, it is in your best interest to understand the legal implications that may come along with transacting in digital assets. In this session, Jeff Neuburger, partner at Proskauer Rose and head of its Blockchain Practice, to covered the following topics and more:
- Categorization of cryptocurrencies as securities and resulting implications
- Types of licenses necessary to be involved in a cryptocurrency business
- Non-fungible tokens and associated legal issues
- Smart contracts
The Young PE Leaders Legal Committee has produced a paper summarising the key legal aspects to be taken into consideration for security token offerings.
Similar to Week 7 - Legal Issues in Blockchain and Cryptocurrencies (20)
Startup Law 101 How to Avoid Legal Pitfalls that Could Doom Your Startup.pptxRoger Royse
A presentation of the legal issues that startups and their founders need to know and the common legal pitfalls that affect startup companies. Unlike more mature companies, startups typically do not have large legal budgets and in house legal counsel focused on legal compliance. Nevertheless, startups must be aware of and comply with law, especially with respect to the issues that are unique to startups.
The presentation covers those unique issues as well as the sometimes surprising and every evolving California rules. In particular, we summarize:
Corporate formation and choice of entity and law;
Securities laws;
Labor and employment and why virtually evert startup in California is probably out of compliance and what you can do about it;
Intellectual property strategies using patent, trademark and trade secret;
Protecting your business through agreements;
Protecting the founders from personal liability;
And more.
The speaker will draw on more than 30 years of startup experience in describing how to manage legal risk on a startup budget.
How Your Company is Affected by the CARES Act and Related LegislationRoger Royse
"Idea to IPO" Webinar description:
The U.S. government is providing relief and stimulating the economy through the $2 TRILLION CARES Act of 2020 and other measures to help corporations, small businesses, and people laid off due to the COVID-19 crisis.
The speaker will discuss:
1) What is the CARES Act of 2020?
2) What does the CARES Act of 2020 hope to achieve?
3) Will there be follow up programs to come?
4) How can entrepreneurs and small businesses benefit from the CARES ACT of 2020?
5) How does one go about applying for grants and loans administered under the CARES ACT of 2020?
6) What are the new rules relating to sick leave and paid leave?
7) What COVID-19 related tax incentives are available to companies?
and more!
How to Get Your Startup Ready for Venture Capital Funding (Idea To IPO)Roger Royse
Venture capital funding is seen as the holy grail for a startup, often improving the company’s chances of a big IPO or exit dramatically. Most companies start their lives with the hope, if not the expectation, that they will eventually receive venture funding. This presentation will cover what a company should do to prepare for venture funding, what steps to take, what the venture capitalists expect and how to avoid venture capital deal breakers.
The speaker will discuss:
1) what types of companies are candidates for venture capital funding
2) the essential assets, qualities or aspects that your company must have to approach a venture capitalist
3) how (and when) you should value your company for venture capitalists
4) how you can protect yourself against dilutive rounds, losing control and being removed from management
5) how to get your company in front of venture capitalists
and more!
Roger Royse discusses the most common legal mistakes made by entrepreneurs and startups. This presentation will focus on issues related to business formation, fundraising, employment, intellectual property, tax, and technology.
Startup Basics: How to Split the Pie, Raise Money and Reward ContributorsRoger Royse
What’s my startup worth? How much equity should founders have? How much equity should I give to employees and consultants? How much should I give the VC’s?
Silicon Valley startup attorney Roger Royse of the Royse Law Firm discusses the basic valuation and ownership issues involved in a startup’s life, from formation to financing to exit, including how to value your company and the contributions of stakeholders and investors at each step with a particular emphasis on different models, best practices and traps to avoid.
Startup Basics: Legal, Business, and Financing StrategiesRoger Royse
Launching a startup - or starting a business - is challenging and is fraught with pitfalls.
Roger Royse, the founder of Royse Law Firm, will discus the basics of building a successful business and how to what mistakes to avoid. Roger will discuss:
1) How should entrepreneurs structure their business?
2) How should founders divide equity?
3) What’s the difference between a contractor and an employee?
4) How does a startup get funded?
5) What is an ICO?
6) How does an entrepreneur successfully negotiate with a VC?
7) How viable is crowdfunding in 2019?
8) How should entrepreneurs protect their intellectual property?
and more!
Funding 101 for Tech Entrepreneurs & StartupsRoger Royse
Roger Royse, founder of the Royse Law Firm, discusses the various options available to entrepreneurs when it comes to funding their startup.
Topics include:
1) What are the best funding options for entrepreneurs to scale their business?
2) When should entrepreneurs pursue external funding?
3) How do entrepreneurs choose the right investor?
4) What alternative sources of funding are available?
5) How and why should a founder stage their funding rounds?
6) When should a founder think about exiting?
7) How can advisors help with the funding process?
Transcript: Selling digital books in 2024: Insights from industry leaders - T...BookNet Canada
The publishing industry has been selling digital audiobooks and ebooks for over a decade and has found its groove. What’s changed? What has stayed the same? Where do we go from here? Join a group of leading sales peers from across the industry for a conversation about the lessons learned since the popularization of digital books, best practices, digital book supply chain management, and more.
Link to video recording: https://bnctechforum.ca/sessions/selling-digital-books-in-2024-insights-from-industry-leaders/
Presented by BookNet Canada on May 28, 2024, with support from the Department of Canadian Heritage.
Essentials of Automations: Optimizing FME Workflows with ParametersSafe Software
Are you looking to streamline your workflows and boost your projects’ efficiency? Do you find yourself searching for ways to add flexibility and control over your FME workflows? If so, you’re in the right place.
Join us for an insightful dive into the world of FME parameters, a critical element in optimizing workflow efficiency. This webinar marks the beginning of our three-part “Essentials of Automation” series. This first webinar is designed to equip you with the knowledge and skills to utilize parameters effectively: enhancing the flexibility, maintainability, and user control of your FME projects.
Here’s what you’ll gain:
- Essentials of FME Parameters: Understand the pivotal role of parameters, including Reader/Writer, Transformer, User, and FME Flow categories. Discover how they are the key to unlocking automation and optimization within your workflows.
- Practical Applications in FME Form: Delve into key user parameter types including choice, connections, and file URLs. Allow users to control how a workflow runs, making your workflows more reusable. Learn to import values and deliver the best user experience for your workflows while enhancing accuracy.
- Optimization Strategies in FME Flow: Explore the creation and strategic deployment of parameters in FME Flow, including the use of deployment and geometry parameters, to maximize workflow efficiency.
- Pro Tips for Success: Gain insights on parameterizing connections and leveraging new features like Conditional Visibility for clarity and simplicity.
We’ll wrap up with a glimpse into future webinars, followed by a Q&A session to address your specific questions surrounding this topic.
Don’t miss this opportunity to elevate your FME expertise and drive your projects to new heights of efficiency.
DevOps and Testing slides at DASA ConnectKari Kakkonen
My and Rik Marselis slides at 30.5.2024 DASA Connect conference. We discuss about what is testing, then what is agile testing and finally what is Testing in DevOps. Finally we had lovely workshop with the participants trying to find out different ways to think about quality and testing in different parts of the DevOps infinity loop.
Search and Society: Reimagining Information Access for Radical FuturesBhaskar Mitra
The field of Information retrieval (IR) is currently undergoing a transformative shift, at least partly due to the emerging applications of generative AI to information access. In this talk, we will deliberate on the sociotechnical implications of generative AI for information access. We will argue that there is both a critical necessity and an exciting opportunity for the IR community to re-center our research agendas on societal needs while dismantling the artificial separation between the work on fairness, accountability, transparency, and ethics in IR and the rest of IR research. Instead of adopting a reactionary strategy of trying to mitigate potential social harms from emerging technologies, the community should aim to proactively set the research agenda for the kinds of systems we should build inspired by diverse explicitly stated sociotechnical imaginaries. The sociotechnical imaginaries that underpin the design and development of information access technologies needs to be explicitly articulated, and we need to develop theories of change in context of these diverse perspectives. Our guiding future imaginaries must be informed by other academic fields, such as democratic theory and critical theory, and should be co-developed with social science scholars, legal scholars, civil rights and social justice activists, and artists, among others.
State of ICS and IoT Cyber Threat Landscape Report 2024 previewPrayukth K V
The IoT and OT threat landscape report has been prepared by the Threat Research Team at Sectrio using data from Sectrio, cyber threat intelligence farming facilities spread across over 85 cities around the world. In addition, Sectrio also runs AI-based advanced threat and payload engagement facilities that serve as sinks to attract and engage sophisticated threat actors, and newer malware including new variants and latent threats that are at an earlier stage of development.
The latest edition of the OT/ICS and IoT security Threat Landscape Report 2024 also covers:
State of global ICS asset and network exposure
Sectoral targets and attacks as well as the cost of ransom
Global APT activity, AI usage, actor and tactic profiles, and implications
Rise in volumes of AI-powered cyberattacks
Major cyber events in 2024
Malware and malicious payload trends
Cyberattack types and targets
Vulnerability exploit attempts on CVEs
Attacks on counties – USA
Expansion of bot farms – how, where, and why
In-depth analysis of the cyber threat landscape across North America, South America, Europe, APAC, and the Middle East
Why are attacks on smart factories rising?
Cyber risk predictions
Axis of attacks – Europe
Systemic attacks in the Middle East
Download the full report from here:
https://sectrio.com/resources/ot-threat-landscape-reports/sectrio-releases-ot-ics-and-iot-security-threat-landscape-report-2024/
Let's dive deeper into the world of ODC! Ricardo Alves (OutSystems) will join us to tell all about the new Data Fabric. After that, Sezen de Bruijn (OutSystems) will get into the details on how to best design a sturdy architecture within ODC.
Builder.ai Founder Sachin Dev Duggal's Strategic Approach to Create an Innova...Ramesh Iyer
In today's fast-changing business world, Companies that adapt and embrace new ideas often need help to keep up with the competition. However, fostering a culture of innovation takes much work. It takes vision, leadership and willingness to take risks in the right proportion. Sachin Dev Duggal, co-founder of Builder.ai, has perfected the art of this balance, creating a company culture where creativity and growth are nurtured at each stage.
Key Trends Shaping the Future of Infrastructure.pdfCheryl Hung
Keynote at DIGIT West Expo, Glasgow on 29 May 2024.
Cheryl Hung, ochery.com
Sr Director, Infrastructure Ecosystem, Arm.
The key trends across hardware, cloud and open-source; exploring how these areas are likely to mature and develop over the short and long-term, and then considering how organisations can position themselves to adapt and thrive.
Assuring Contact Center Experiences for Your Customers With ThousandEyes
Week 7 - Legal Issues in Blockchain and Cryptocurrencies
1. Legal Issues in
Blockchain and Cryptocurrencies
Roger Royse
rroyse@rroyselaw.com
www.rroyselaw.com
Research Assistant: Justin Sher
1
Stanford Continuing Studies FALL 2018 BUS 35
The Business Basics of Blockchain, Crypto Currencies, and Tokens
Week 7 August 5, 2019
2. Legal Issues in Blockchain and
Cryptocurrencies
I. Intro: Coin vs. Token
II. Securities Law: Is Cryptocurrency a security?
III. FinCEN: Is Cryptocurrency a currency?
IV. CFTC: Is Cryptocurrency a commodity?
V. ICOs: Legal Considerations
VI. Patent Issues in blockchain
VII. Cryptocurrency Regulation: US and International
VIII.Tax Discussion (continue to Week 8)
2
3. Intro: Distinction between Coin and Token
• Typically, “Coin” refers to more transactional based cryptocurrencies
whereas “Token” refers more to a type of investment vehicle
• Coin
• Describes a certain feature of a type of distributed ledger software program
• Rights and responsibilities of a coins may be exchanged among the parties who make
use of the software
• Token
• Describes manner of a claim against an entity or its assets that arise from the use of
distributed ledger technology
• Representations of claim that an entity may extend to others in exchange for
proceeds of varying forms
3
4. I. Securities Law
• What is a security?
• SEC Definition
• Under Section 2(a)(1) of the Securities Act, the term “security” is defined as: – any note, stock, treasury
stock, security future, security-based swap, bond, debenture, evidence of indebtedness, certificate of
interest or participation in any profit-sharing agreement, collateral-trust certificate, preorganization
certificate or subscription, transferable share, investment contract, voting trust certificate, certificate of
deposit for a security, fractional undivided interest in oil, gas, or other mineral rights, any put, call,
straddle, option, or privilege on any security, certificate of deposit, or group or index of securities
(including any interest therein or based on the value thereof), or any put, call, straddle, option, or
privilege entered into on a national securities exchange relating to foreign currency, or, in general, any
interest or instrument commonly known as a “security,” or any certificate of interest or participation in,
temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or
purchase, any of the foregoing
4
5. Securities Exchange Act of 1934
5
With this Act, Congress created the Securities and Exchange Commission. The Act
empowers the SEC with broad authority over all aspects of the securities industry. This
includes the power to register, regulate, and oversee brokerage firms, transfer agents, and
clearing agencies as well as the nation's securities self regulatory organizations (SROs).
The various securities exchanges, such as the New York Stock Exchange, the NASDAQ
Stock Market, and the Chicago Board of Options are SROs. The Financial Industry
Regulatory Authority (FINRA) is also an SRO.
The Act also identifies and prohibits certain types of conduct in the markets and provides
the Commission with disciplinary powers over regulated entities and persons associated
with them.
The Act also empowers the SEC to require periodic reporting of information by companies
with publicly traded securities.
6. Securities Act of 1933
6
Often referred to as the "truth in securities" law, the Securities Act of 1933
has two basic objectives:
Requires that investors receive financial and other significant
information concerning securities being offered for public sale; and
Prohibits deceit, misrepresentations, and other fraud in the sale of
securities.
7. Other Federal
7
Trust Indenture Act of 1939
This Act applies to debt securities such as bonds, debentures, and notes that are offered for public sale.
Investment Company Act of 1940
This Act regulates the organization of companies, including mutual funds, that engage primarily in investing,
reinvesting, and trading in securities, and whose own securities are offered to the investing public.
Investment Advisers Act of 1940
This law regulates investment advisers.
Sarbanes-Oxley Act of 2002
The Act addresses corporate responsibility, enhances financial disclosures and combats corporate and
accounting fraud, and created the "Public Company Accounting Oversight Board," also known as the PCAOB,
to oversee the activities of the auditing profession.
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
Reshape the U.S. regulatory system in consumer protection, trading restrictions, credit ratings, regulation of
financial products, corporate governance and disclosure, and transparency.
Jumpstart Our Business Startups Act of 2012
The JOBS Act helps businesses raise funds in public capital markets by minimizing regulatory requirements.
8. State Blue Sky Laws
8
States also regulate the sale of securities in their states
National Markets Improvement Act of 1996 (NSMIA)
The NSMIA amended Section 18 of the Securities Act to pre-empt state “blue
sky” registration and review of specified securities and offerings. The
preempted securities are called “covered securities.” The NSMIA also amended
Section 15 of the Exchange Act to pre-empt the state’s authority over capital,
custody, margin, financial responsibility, making and keeping records, bonding or
financial or operational reporting requirements for brokers and dealers.
9. Is a Token a Security?
Howey Test: a transaction is an “investment contract” if:
1. It is an investment of money
2. There is an expectation of profits from the investment
3. The investment of money is in a common enterprise
4. Any profit comes from the efforts of a promoter or third party
The SEC takes the position that some cryptocurrencies may be
securities
9
10. SEC Chairman, Jay Clayton
“I do not believe that digital tokens such are Bitcoin, when used to
replace currency as a medium of exchange are securities.”
“Then there are tokens, which are used to finance projects. I've been
on the record saying there are very few, there's none that I've seen,
tokens that aren't securities. To the extent something is a security, we
should regulate it as a security, and our securities regulations are
disclosure-based, and people should follow those and provide the
information that we require.”
10
11. SEC Scrutiny of the ICO and Enforcement
• The SEC’s Office of Investor Education and Advocacy is warning
investors about potential scams involving stock of companies claiming
to be related to, or asserting they are engaging in, Initial Coin
Offerings (or ICOs)
• Fraudsters often try to use the lure of new and emerging technologies
to convince potential victims to invest their money in scams.
• These frauds include “pump-and-dump” and market manipulation
schemes involving publicly traded companies that claim to provide
exposure to these new technologies
11
12. SEC is suspending trading
• The companies affected by trading suspensions: First Bitcoin Capital
Corp., CIAO Group, Strategic Global, and Sunshine Capital
• Circumstances that might lead to a trading suspension include:
• A lack of current, accurate, or adequate information about the company
• Questions about the accuracy of publicly available information, including in
company press releases and reports, about the company’s current
operational status and financial condition; or
• Questions about trading in the stock, including trading by insiders, potential
market manipulation, and the ability to clear and settle transactions in the
stock
12
13. SEC Actions
13
DAO Token – model described by one of the DAO founders as similar to “buying shares in a
company and getting…dividends”
Munchee - restaurant meal reviews
SEC halted cease and desist – unregistered securities
ICO targeted investors, who had an expectation of future profits, rather than users of the
products, with intention to use proceeds to develop application and future “ecosystem”,
which would increase the value the MUN token
Marketing materials stated additional development and ecosystem would increase the
price of the MUN token and could trade on secondary market within 30 day after ICO
Recent ICO Subpoenas
14. Rule 10(b)-5 Private Right of Action
14
Section 10(b) of the Securities Exchange Act of 1934 gives shareholders a
private right of action to seek damages for securities fraud
Rule 10b-5 forbids “any person, directly or indirectly, . . . [t]o make any untrue
statement of a material fact” in connection with the purchase or sale of
securities
Ripple XRP Class Action Lawsuits are an example
15. Securities Law Compliance
15
1. Public offering (S-1 registration)
2. Reg CF, Reg D, Reg A, Reg A+, Reg S
3. Crowdfunding
1. Initial disclosure requirement
2. Exemption from registration: Up to 1.07 million in 12 months period
3. Issuer disclosure requirement
16. Are Cryptocurrencies Commodities?
• CFTC definition: “Commodity”
• Until Congress clarifies, the CFTC has concurrent authority, along with
other state and federal administrative agencies, and civil and criminal
courts, over dealings in virtual currency – March 6, 2018 US Dist. New
York
• This decision allows the CFTC to proceed with a fraud enforcement
case against CabbageTech Corp., doing business as Coin Drop
Markets, and its CEO
16
17. CFTC
A commodity, as defined in the Commodity Exchange Act, includes the
agricultural commodities enumerated in Section 1a(9) of the Commodity
Exchange Act, 7 USC 1a(9), and all other goods and articles, except onions as
provided in Public Law 85-839 (7 USC 13-1), a 1958 law that banned futures
trading in onions, and all services, rights, and interests in which contracts for
future delivery are presently or in the future dealt in; (2) A physical commodity
such as an agricultural product or a natural resource as opposed to a financial
instrument such as a currency or interest rate. See 7 USC 1a(9)
In a preliminary injunction order issued March 6, 2018, U.S. District Court for
the Eastern District of New York ruled that the CFTC has concurrent authority,
along with other state and federal administrative agencies, and civil and
criminal courts, over dealings in virtual currency. This decision allows the CFTC
to proceed with a fraud enforcement case against CabbageTech Corp., doing
business as Coin Drop Markets, and its CEO
17
18. CFTC
The CFTC does NOT have regulatory jurisdiction under over markets or
platforms conducting cash or “spot” transactions in virtual currencies or other
commodities or over participants on such platforms. T
The CFTC DOES have enforcement jurisdiction to conduct civil enforcement
actions against fraud and manipulation in virtual currency derivatives markets
and in underlying virtual currency spot markets.
The CFTC does have both regulatory and enforcement jurisdiction under the
CEA over derivatives on virtual currencies traded in the United States. This
means that for derivatives on virtual currencies traded in U.S. markets, the
CFTC conducts comprehensive regulatory oversight, including imposing
registration requirements and compliance with a full range of requirements for
trade practice and market surveillance, reporting and monitoring and
standards for conduct, capital requirements and platform and system
safeguards.
18
19. Financial Crimes Enforcement Network
19
US Department of Treasury
The mission of the Financial Crimes Enforcement Network is to safeguard the financial
system from illicit use, combat money laundering, and promote national security through
the strategic use of financial authorities and the collection, analysis, and dissemination of
financial intelligence.
Money Services Business Registration
Bank Secrecy Act compliance
Suspicious Activity Reports
OFAC (Office of Foreign Assets Control)
20. FINCEN FEB 13 LETTER
Financial Crime Enforcement Network (FINCen), Dep’t of Treasury letter to Senator Ron
Wyden (D- Ore)
1) A developer that sells convertible virtual currency (i.e., bitcoin, ether, ripple, etc) including
in the form of ICO coins or tokens, in exchange for another type of value that substitutes for
currency is a money transmitter and must comply with AML/CFT requirements that apply to
this type if MSB ( and register as a MSB with FInCen - a form filed annually and disclosure of
some financial information).
2) An exchange that sells ICO coins or tokens, or exchanges them for other virtual currency,
fiat, or other value that substitutes for currency, would typically also be a money transmitter.
3) FInCEN AML/CFT rules likely do not apply to ICO structures where (a) the tokens are offered
as securities - SEC jurisdiction and their AML/KYC requirements or (b) future interests in
commodities - CFTC jurisdiction and their AML/KYC requirements.
20
21. II. Crypto funding: Legal Issues
• SEC compliance: Regulation A, Regulation D, or Regulation CF can be used
• US vs. Offshore Offering
• Investment Company Act: Qualified investors
• “Exchanges”
• Disclosure – White Paper
• Potential CFTC and FinCEN Compliance
• PR + Marketing
21
22. Exemption from Registration
• The private company issuer (aggregated with predecessors and companies
under common control) may sell up to $1.07 million of securities in a 12-month
period [adjusted for inflation]
• Individual investments in all crowdfunding issuers in a 12-month period are
limited to:
o If either their annual income or net worth is less than $107,000, then the
greater of:
$2,200 or
5 percent of the lesser of their annual income or net worth
o If both their annual income and net worth are equal to or more than
$107,000, then
10 percent of the lesser of their annual income or net worth (up to a
maximum of $107,000)
o Issuer may rely on intermediary’s calculation of investor limits, unless issuer
knew it was or would be wrong
• Process is expensive and burdensome
Reg CF Crowdfunding
22
23. • Investment must be through the online platform of an “intermediary”
broker or funding portal
o Intermediary must register with the SEC and FINRA
o Issuer can only use one intermediary in any concurrent offerings based off of
crowdfunding exemption; however, multiple crowdfunding offerings may be
conducted using different portals so long as the aggregate amount in the
same 12-month period does not exceed the 1.07 million limit
o Many limitations on what entities can be intermediaries (e.g., must be good
actor)
o Stringent limitations on having financial interests in issuers using platform
o Only allow issuers if reasonable to believe they are compliant, and there is no
reasonable basis to think there is a potential for fraud
o Cannot accept commitment from investor until investor has account with
platform, and platform provides needed information
o Must make sure investors aren’t exceeding their caps, and that they
acknowledge and understand the risks
o Must provide communication services between investors and issuer
o Many other requirements and filings
Crowdfunding
23
24. • Issuer disclosure requirements
o File basic business, offering details in Form C with SEC; then display publicly
o Amend Form C if any material changes occur via Form C/A
o File updates (Form C-U) with SEC within five days of certain milestones
(such as enough commitments, offers, or closing of issuance)
o File financial statements meeting GAAP, and GAAS or PCAOB if applicable
Audited if offering exceeds $500,000, except first time issuers need only have
independent CPA review
Reviewed by an independent CPA if offering is between $100,000 and $500,000
If $100,000 or less, certain information from tax forms and CEO-certified financials
In any event, if more trustworthy financials available than are required (i.e., if
audited or CPA-reviewed are available), use those instead
o File annual SEC reports via Form C-AR
o File Form C-TR to terminate annual reporting obligations in five days of
eligibility (e.g., became Exchange Act issuer, has fewer than 300 recorded
holders or not more than $10 million total assets)
Crowdfunding
24
25. • Accredited investors only who may self verify
• $200,000 annual income current year and prior two years
($300,000 jointly) or
• $1,000,000 net worth excluding personal residence
• Issuers are prohibited from making general solicitations
• Direct communications to persons with whom the issuer or its
broker has a “pre-existing, substantive relationship” are not
considered general solicitations
Private Offerings Under Rule 506(b)
25
26. 506(c) Offering
26
Rule 506(c): issuers can offer securities through means of general
solicitation as long as:
oAll purchasers are accredited investors; and
oThe issuer takes “reasonable steps” to verify the purchasers’
accredited investor status
27. • A determination of “reasonable steps” requires consideration of:
o Nature of the purchaser;
o Amount of information the issuer has about the purchaser; and
o Nature of the offering, terms, amount, and method of solicitation
• The SEC has provided a non-exhaustive list of methods to verify status:
o Review IRS forms that report income e.g. Form W-2 or K-1;
o Review documents for asset details e.g. bank or brokerage
statements; or
o Obtain confirmation from CPA, lawyer, SEC-registered investment
advisor, or broker-dealer that reasonable steps were taken to verify
accredited investor status
General Solicitation
27
28. • The oldest exemption issued by the SEC
• Although it allowed non-accredited investors to invest, was rarely used,
because of high compliance costs relative to the maximum funds raised
o $5 million maximum offering
o Did not preempt state law registration, requiring registrations in many states
• The JOBS Act included legislation to create what is nicknamed
“Regulation A+”, an upgrade to Regulation A
• The new Regulation A keeps the allowance of non-accredited investors,
and features two kinds of Regulation A offerings, called “Tiers”:
o Tier 1, with a $20 M maximum, does not preempt state law registration, but has low
federal compliance burdens
o Tier 2, with a $50 M maximum, preempts state law registration, but has high federal
compliance burdens including ongoing semi-annual, annual, and current disclosures
Reg. A – History
28
29. Issue 506(b) 506(c) Reg. A Tier 2
State law
regulations?
Preempted Preempted Preempted
Maximum amount
raised?
Unlimited Unlimited $50 M in 12 months, up to
$15M of which from
current holders
Per investor
maximums?
Unlimited Unlimited Up to 10% of greater of
unaccredited investor’s
net worth or net income;
unlimited for accredited
Investor limitations Unlimited
accredited, and
35 sophisticated
non-accredited;
self-certification
standard
Accredited
only, and issuer
must take
steps to certify
they are
accredited
Unlimited accredited (self-
certified), unlimited non-
accredited
506(b), 506(c), and Reg. A Tier 2
29
30. Issue 506(b) 506(c) Reg. A Tier 2
Issuer limitations No bad actors No bad
actors
Cannot be public,
shell company, bad
actor, those failing
certain SEC
compliance rules
Solicitation,
advertising
Banned Soliciting of
anyone is
allowed
Testing for interest,
soliciting OK
Initial disclosures Non-accredited:
Equivalents of what they
get in registered offering,
plus anything accredited
investor can get
For accredited, see 506(c)
Optional;
must be
available to
answer
questions
Financial statements
for past two years
disclosed, plus
offering circular
with audited
financials
506(b), 506(c), and Reg. A Tier 2 (cont.)
30
31. Issue 506(b) 506(c) Tier 2
Ongoing disclosures Form Ds Form Ds Yes, if 300+ holders;
annual, semiannual, and
current events. But special
exemption from Exchange
Act registration until over
$75M float.
Share restriction Restricted for a
year
Restricted for a
year
Unrestricted; affiliates still
have some limits
Allowed securities? ABS not
specifically
banned
ABS not
specifically
banned
Asset backed-securities
banned
506(b), 506(c), and Reg. A Tier 2 (cont.)
31
32. Regulation S
Regulation S is a "safe harbor" that defines when an offering of
securities is deemed to be executed in another country and therefore
not be subject to the 1933 Act.
Two safe harbors: an issuer safe harbor and a resale safe harbor.
32
33. Issuer
Law
• Securities Law
• Tax
• AML/KYC
• Anti Fraud
• FINCEN
• CFTC
• FTC
• Investment Company Act
• Exchange Act
$
Step 2: Build
Platform
Step 1:
Pre-Sale
$orCrypto
SAFT
Investors
Step 3: ICO
Tokens
Investors
The ICO
Team
• Legal US
• Tax US
• Foreign Legal
• Compliance
• Marketing
• KYC/AML
• ICO Economies
• Blockchain
Technical
Utility
• Use of Token
• Secondary Trading
• Scarcity
• Voting + Democratized
33
34. US Platform Co. Cayman ICO Co. Singapore ICO
Foundation
$
$
SAFT
$
tokens
Token Securities Compliance
Step 1
Step 3: Cash to
US Co.
$
Step 2: ICO
Issuance
1) 506 – All accredited
2) 506/Reg S foreign targeted offering
3) Non US offering
4) Foreign Utility Tokens – not a security
5) Reg A+
6) Register with SEC
7) Sec 4(a)(2) private offering
Resale
Rule 144 (12 month holding)
Section 12(g)
Rule 12g3-2(b)
34
35. III. Patent issues in Blockchain
• Patent gives right to exclude all others in U.S. from making invention
for duration of patent (20 years)
• Patent - Bank of America, NASDAQ
• Open Source - Hyperledger
• Patent Pledge - Blockstream (will not sue)
• Patent Pool – similar to Open Invention Network (Linux)
• Trade Secret: “CryptoKitties,” sued for using Ethereum blockchain
technology to “allow[] users to securely buy, sell, trade, and breed
genetically unique virtual cats.” Founder Starcoin v. Launch Labs, Inc., No. 18-CV-972 JLS
(MDD) (S.D. Cal. July 9, 2018).
35
36. Is Blockchain Technology patentable?
• No specific guidance from the U.S. Patent Office yet on blockchain
patent applications.
• Blockchain technology generally involves the improvement of the
functioning of a computer, subject to “abstract idea” problem
• White papers, Hyperledger and Ethereum open source projects can
be count as challenges to patents
• As with all nascent technology, there's a potential to secure patents
with broad claims scope as prior art is less available and less well
understood by USPTO
36
37. IV. Cryptocurrency Regulation: US
• Regulatory climates in the US
• No coherent direction on blockchain technology or cryptocurrency regulation
• SEC has warned investors of cryptocurrency investing risk, halted several ICOs
and hinted at the need for greater regulation
• CFTC allowed cryptocurrency derivatives to trade publicly in 2017
• For non-US investors
• If the U.S. treats cryptocurrencies as currency, the federal government would
preempt states licensing
• Otherwise, if it treats as securities, cryptocurrencies, especially ICOs would
have to clear “blue sky laws” on a state-by-state basis
• SEC has not completely cleared this issue up
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38. Cryptocurrency Regulations among States
• Delaware’s Blockchain Initiative (DBI)
• Initiated DBI committed to use blockchain technology in 2015
• When distributed ledger technology hit their radar screen in 2015, State
officials immediately understood the ramifications of the technology
• The state’s strong motivation to attract business from companies: improving
services related to registrar, UCC, land titles, personal properties, and
professional license
• The first milestone: The rollout of distributed ledger technology at the
Delaware Public Archives
• The second milestone: “Smart UCC filings”
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39. Cryptocurrency Regulations among States
• Wyoming’s 13 Blockchain bills
• HB 57 – Fintech Sandbox
• HB 62 – Wyoming Utility Token Act
• HB 70 – Commercial Filing System
• HB 74 – Special Purpose Depository Institution
• HB 113 – Special Electric Utility Agreements Between Utilities and Cryptominers
• HB 185 – Corporate Stock Tokens
• SF 28 -- Banking Technology and Stock Revisions
• SF 125 -- Digital Assets
• SF 159 – Sell Coal Fired Plants, possibly to Cryptominers
• SF 111 – Property tax exemption for virtual currencies
• HB 101 – Corporate Record on the Blockchain
• HB 126 – Allows LLCs to decentralized governance to reduce risks of token ownership
• HB 19 – Money Transmitter Act Exemption for Virtual Currencies
• https://media.consensys.net/what-wyomings-13-new-crypto-laws-mean-for-blockchain-in-the-us-1bcf8b7a39d4
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40. Cryptocurrency Regulations among States
• Nevada’s Recently Passed Blockchain Bills
• SB161 – Creates a “sandbox” providing for a temporary exemption from
certain statutory and regulatory requirements.
• SB162 – Adds “public blockchain” as a type of electronic record under the
Uniform Electronic Transactions Act.
• SB163 – Authorizes businesses to store and maintain corporate records on a
blockchain.
• SB164 – Defines virtual currencies as intangible personal property similar to
how stocks are treated in Nevada.
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41. Cryptocurrency Regulation: Global
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• Switzerland: known for progressive attitude to cryptocurrency regulation . In
February 2019, the Swiss Financial Market Supervisory Authority FINMA
became the first major economy to set out clear guidelines on ICO
• South Korea : Significant cryptocurrency presence in the past but regulatory
uncertainty and negative prospect are growing
• Singapore: relatively progressive compared to other Asian countries. The
country’s law is attempting to remove distinction between transactions
conducted using fiat currency and cryptocurrency
• Malta: an early pioneer in blockchain and cryptocurrency regulation
42. Cryptocurrency as Regulated Investment
• More and more investors are seeking to diversify their investment in
cryptocurrencies.
• BB Index is one of the world’s first diversified cryptocurrency indices
with exposures to different segments of the cryptocurrency market.
• Offering 26 different investable indices which generally include 7, 20 or 50
cryptocurrencies in each index.
• On December 10, 2017, the Chicago Board Options Exchange (CBOE)
opened the inaugural futures market for bitcoin, followed a week
later by a futures market on the Chicago Mercantile Exchange (CME)
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43. V. Tax Consideration
• Equity? Debt?
• Capital asset? Barter exchange?
• Prepaid goods or services?
• Deferral?
• Open - transaction?
• Forward contract ?
• Executory Agreement to Sell?
• Information Reporting
• FATCA
• FBAR
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44. Is Cryptocurrency property for federal tax?
• Virtual currency treated as property for federal tax purposes.
• Income or amount realized at fair market value when received.
• Gain or loss when exchanged.
• Subject to information reporting and back-up withholding to same extent
as any other payment in property.
• Characterization and type of income determined as if cash received.
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45. Taxation to Miners
• Miners must report the fair market value of the currency (on the day
they received it) as gross income.
• Miners are also required to pay self-employment tax — that is, Social
Security and Medicare taxes — if the mining “constitutes a trade or
business,” according to the I.R.S.
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46. Taxation to Issuers
• What are the consequences to issuers of tokens?
• 1.Capital contributions to corporations, partnerships, other?
• 2.Advance sale of services?
• 3.Analogy to miners (subscribers)?
• What happens to token holders on subsequent events?
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47. Cryptocurrency Transactions and Tax
• Until the end of 2017, some investors have relied on the law to
exchange one cryptocurrency for another without paying taxes under
section 1031
• For instance, someone who owned Bitcoin could diversify their
holdings into Ethereum or Litecoin, and plausibly report to the IRS it
created no tax obligations.
• This is no longer the case because of a change to definition of
property eligible for the “1031 exchange.
• In Canada, all transactions in cryptocurrency are considered taxable
events.
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