Issuers Of Digital Securities May Benefit From Proposed Changes To Regulation A

In March, the Securities and Exchange Commission (SEC) announced proposed rule amendments to "harmonize, simplify, and improve the exempt offering framework to promote capital formation and expand investment opportunities while preserving and enhancing important investor protections," which may increase the viability of conducting issuances of digital securities. Under the Securities Act of 1933, every offer and sale of securities must either be registered with the SEC or qualify for an exemption from the SEC's registration requirements. Where appropriate, an offering conducted pursuant to the exempt offering framework may be more efficient and less expensive than a registered offering. The SEC's proposed amendments aim to facilitate such efficiency, by "[addressing] gaps and complexities in the exempt offering framework that may impede access to investment opportunities for investors and access to capital for issuers."