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Blockchain Advising and Compliance

Security Token Offerings (STOs)

A security token offering (STO) is an innovative method of raising capital and offering fractionalized ownership in a business, an asset or debt. By offering a token, issuers and investors experience frictionless administration of the interest, exposure to global liquidity, and assurance in transfers stemming from baked-in compliance.

Our attorneys leverage a deep understanding of blockchain and securities laws to guide clients through the entire process of conducting an STO. Over the years, we have built a professional network of industry-leading issuance platforms, marketing partners, and broker-dealers who work together to ensure the success of a token sale.

We have worked with clients to tokenize over $6 million of commercial real estate, company equity, and revenue producing assets.

Pre and Post-Token Sale Advising

The applicability of U.S. securities laws to Initial Coin Offerings was at best uncertain from the time the first ICO launched to the SEC’s release of The DAO Report and In re Munchee Inc. in late 2017. Indeed, the 2018 Annual Report of the SEC’s Division of Enforcement made clear it will continue to focus on issues related to ICOs and digital assets.

Our attorneys advise clients regarding pre and post-token sale issues to remediate unlawful sales and structure token offerings to comply with the appropriate regulatory framework. We do not believe all tokens are securities and a one-size fits all approach is unacceptable. We work closely with developers and entrepreneurs to understand the nuances of each token structure and advise clients accordingly.

Digital Asset Fund Formation

The rise and fall of ICOs was swift from 2016-2017. Today, many digital asset funds exist to invest directly in new blockchain projects through private placements. Our lawyers can assist in both the formation and ongoing operation of a range of investment funds, including: 

  • Private equity funds
  • Debt funds
  • Venture capital funds
  • Real Estate Investment Trusts (REITs)
  • Digital asset funds

Broker-Dealer Registration

Under U.S. securities laws, a person “effecting securities transactions” must register as a broker-dealer and comply with a host of related regulations. These requirements may apply to persons who participate in the issuance or transacting of securities in a variety of ways including finding investors and negotiating private investments.

Our attorneys assess the activities of each client to recommend cost-efficient methods of operating in compliance with Broker-Dealer regulations. If necessary, the firm will provide full support in obtaining registration and complying with reporting requirements for broker-dealers.

Alternative Trading System (ATS) Registration

The Securities and Exchange Commission (SEC) closely scrutinizes the conduct of private companies operating platforms that offer trading of securities and digital assets. In 2018, the SEC took aim at an individual for operating EtherDelta, an online platform that allowed buyers and sellers to trade certain digital assets. The SEC imposed a civil fine of $75,000 and ordered the responsible individual to pay an additional $313,000 in disgorgement for failing to register the platform as a national securities exchange or an alternative trading system. In the Matter of Zachary Coburn, Exchange Act Rel. No. 84553 (Nov. 8, 2018). 

Our attorneys are experienced in assisting clients developing digital asset trading platforms and operating decentralized exchanges. We assist developers in navigating the complex regulatory questions and complying with application and disclosure requirements to be come a registered ATS.

By communicating with regulators and observing traditional compliance procedures, we offer efficient solutions so innovators can focus on what they do best.

Money Transmitter Registration

A patchwork of state laws offers conflicting interpretations of how to apply money transmitter laws to virtual currency activities. Certain states choose not to require registration while others demand administrators and exchangers obtain money transmitter licenses. Our attorneys advise clients on how to navigate the conflicting approaches taken by various states and comply with FinCEN regulations applied to virtual currency activities.

KYC/AML Compliance

Whether you are operating a trading platform, conducting broker-dealer activities, or soliciting investment to develop your business, implementing appropriate Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures is a legal requirement for most virtual currency businesses.

Our attorneys have advised clients on how to set up a comprehensive Anti-Money Laundering policy and adhere to federal Know-Your-Customer laws.

Security Token Offerings (STOs)

A security token offering (STO) is an innovative method of raising capital and offering fractionalized ownership in a business, an asset or debt. By offering a token, issuers and investors experience frictionless administration of the interest, exposure to global liquidity, and assurance in transfers stemming from baked-in compliance.

BBL’s attorneys leverage a deep understanding of blockchain and securities laws to guide clients through the entire process of conducting an STO. Over the years, we have built a professional network of industry-leading issuance platforms, marketing partners, and broker-dealers who work together to ensure the success of a token sale.

We have worked with clients to tokenize over $6 million of commercial real estate, company equity, and revenue producing assets.

Pre and Post-Token Sale Advising

The applicability of U.S. securities laws to Initial Coin Offerings was at best uncertain from the time the first ICO launched to the SEC’s release of The DAO Report and In re Munchee Inc. in late 2017. Indeed, the 2018 Annual Report of the SEC’s Division of Enforcement made clear it will continue to focus on issues related to ICOs and digital assets.

BBL has advised clients regarding pre and post-token sale issues to remediate unlawful sales and structure various unique token offerings to comply with the appropriate regulatory framework. We do not believe all tokens are securities and a one-size fits all approach is unacceptable. We work closely with developers and entrepreneurs to understand the nuances of each token structure and advise clients accordingly

Digital Asset Fund Formation

The rise and fall of ICOs was swift from 2016-2017. Today, many digital asset funds exist to invest directly in new blockchain projects through private placements. Our lawyers can assist in both the formation and ongoing operation of a range of investment funds, including: 

  • Private equity funds
  • Debt funds
  • Venture capital funds
  • Real Estate Investment Trusts (REITs)
  • Digital asset funds
Broker-Dealer Registration

Under U.S. securities laws, a person “effecting securities transactions” must register as a broker-dealer and comply with a host of related regulations. These requirements may apply to persons who participate in the issuance or transacting of securities in a variety of ways including finding investors and negotiating private investments.

BBL assesses the activities of clients to recommend cost-efficient methods of operating in compliance with Broker-Dealer regulations. If necessary, the firm will provide full support in obtaining registration and complying with reporting requirements for broker-dealers.

ATS Registration

The SEC closely scrutinizes the conduct of private companies as well as emerging platforms that trade in private company securities and vows to bring enforcement cases as needed to protect investors. BBL guides clients developing alternative trading systems through the complex issues presented by applying conventional laws to novel technology.

By communicating with regulators and observing traditional compliance procedures, we offer efficient solutions so innovators can focus on what they do best.

Money Transmitter Registration

A patchwork of state laws offers conflicting interpretations of how to apply money transmitter laws to virtual currency activities. Certain states choose not to require registration while others demand administrators and exchangers obtain money transmitter licenses. BBL advised clients on how to navigate the conflicting approaches taken by various states and comply with FinCEN regulations applied to virtual currency activities.

KYC/AML Compliance

Implementing Know Your Customer and Anti-Money Laundering procedures is required for certain virtual currency actors. BBL is experienced in advising clients on how to set up a comprehensive AML policy and adhere to federal KYC laws

 

please contact Bull Blockchain law by sending us an email to info@bullblockchain.com or calling us at 267.614.4627

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