Blockchain Legal Resource: The Initial Exchange Offering

As this short video explains, the "initial exchange offering," or IEO, is the latest innovation in the offer and sale of cryptocurrencies. By partnering with a crypto exchange to aid in marketing and listing efforts, issuers engaging in an IEO hope to obtain better visibility and liquidity for their products. But like the ICOs they seek to replace, IEOs raise a host of potential issues under the US federal securities laws.

Many of the cryptocurrencies offered for sale in an IEO are likely to constitute securities under the SEC's  DAO Report analysis and more recent framework  guidance. Intermediaries transacting in digital securities on behalf of issuers or investors are also subject to a wide variety of  SEC regulations and may be required to register with the SEC in one or more capacities. To date, however, no cryptocurrency exchange has been registered with the Securities and Exchange Commission (SEC) as an exchange. Registration as a broker-dealer may also