Thank you again for being a member of the most fantastic community in crypto. This post is about a critical update to the Stockchain presale.
As you may be aware, the United States Securities and Exchange Commission has been very active lately in the crypto space. The SEC is the main regulator for securities and offerings in the United States, and has been trying to clarify its approach to token sales, which of course are a new construct whose treatment under securities laws is not clear.
Last year, as we were designing the Stockchain presale, the folks at the SEC were taking a pretty hands-off approach. However, in the past few days they have issued some statements that are very concerning to the Stockchain team and its legal counsel. In particular, they have now suggested that a token sale simply constituted an unregistered offering of securities. The SEC has been generally taking a harder and harder stance about token offerings, and it has, in the past couple of days (i.e., after the token sale started), started to look like early-stage offerings like ours are particularly at risk.
As you know, our goal has been to use the Stockchain presale as a springboard to continue to build out the platform in anticipation of an ICO a little later this year. With the change in the SEC’s regulatory perspective, we have become concerned that this goal is at risk. It wouldn’t help the company or the purchasers in the presale if regulatory authorities come in and shut us down in the middle of building out the platform, which would result in the loss of purchaser money and not much of a product to show for it.
We want to ensure that our community members—you—are as secure as possible. Also, as you know, one of the foundational goals of Stockchain has always been to act in accordance with regulatory requirements, and this includes not only the platform but also the token.
Because of the SEC’s actions in the past couple of days, our securities counsel has advised us that the uncertainty around a very early-stage sale like ours has greatly increased. We believe this uncertainty is now at an unacceptable level, at least how the company and token sale are currently structured.
To be clear, no regulator has contacted us, but the last thing that we want is for your funds to be at risk due to the changing regulatory regime.
Accordingly, we have determined to refund everyone their full amount of ether that they put into Stockchain and put the sale on hold until we can be certain, with the SEC, that any sale we may have will meet all regulatory requirements in spite of the SEC’s evolving positions.
We are continuing to build out the platform and technology concurrently with this regulatory work. When we move forward with the sale, you will be the first to know, as we would love to continue to have everyone’s involvement at that point.
Thanks again for your support. We plan to start refunding everyone’s ETH in the next couple of business days to the wallet it was sent from. Note that with everything that we have to do to put the sale on hold, it will probably take up to five business days to get everyone’s ETH refunded.