Opinion: SEC's proposal for "cryptocurrency regulation" may not trigger a new wave of ICO frenzy According to BlockBeats, on August 26th, the US SEC announced proposed rules for "Regulation Crypto Assets" on August 18th, which set two exemptions for specific investment contracts involving cryptocurrency assets: one allows startups to raise up to $5 million in one-time funding within 4 years; The second option allows eligible issuers to raise up to $75 million in any 12 months and may conduct different rounds of issuance in subsequent years. Winston&Strawn partner Drew Hinkes stated that as long as each round of financing is indeed an independent issuance, the project could theoretically raise $75 million every 12 months. However, Lilya Tessler, the head of Sidley's fintech and blockchain business, pointed out that subsequent financing is not automatically approved. The issuer needs to resubmit the prospectus, undergo SEC staff review, and continue to submit annual and semi annual reports, while disclosing the funds raised through the exemption in the past 12 months to confirm that they have not exceeded the limit. The proposed rules also limit the participation size of non qualified investors, whose purchase amount shall not exceed 10% of the higher of personal income or net assets. Duke University financial regulatory expert Lee Reiners believes that the limited first round quota may make early token quotas more attractive, but the rule is unlikely to replicate the ICO boom of 2017. The previous round of ICO has already had an impact on investor confidence, with as many as 90% of projects financed through ICO between 2017 and 2019 ultimately failing. The SEC expects that approximately 130 issuances per year will use the two exemptions mentioned above, and approximately 475 issuers may use a wider range of investment contract safe havens. The new rules will provide token issuers with a clearer US financing pathway than the current system, but there may still be securities gray areas in secondary market trading. The proposal stipulates that investment contracts related to encrypted assets may continue to be transferred with tokens in secondary market transactions until the asset is separated from the issuer's statements or commitments. Hinkes stated that if non securities tokens transfer investment contracts from the seller to the buyer, their transactions may still be considered securities trading and have an impact on the trading platform. Reiners also warned that some issuers may meet the formal requirements for exemptions, but still affect the value of tokens through team management efforts, insider concentration of holdings, and aggressive promotion. [Original link]