The first token offering to be approved by the U.S. Securities and Exchange Commission (SEC) is coming to America and beyond, courtesy of decentralized computing and dapp firm Blockstack PBC.
Announced by the company’s leadership on July 10th, the approval means Blockstack will begin its public sale of Stacks (STX) tokens in accordance with the regulator’s Regulation A+ framework, an IPO alternative used by startups to raise funds.
The qualification has immediately paved the way for the STX offering to start, the firm said:
“Blockstack will conduct a $28 million cash offering. The token offering will open on Thursday, July 11th […] It will be open to any purchaser who would like to take part in the Blockstack next-generation computing network, subject to a small number of geographical restrictions. This means everyone from general enthusiasts, to longstanding Blockstack supporters, to accredited or non-accredited investors alike […] can participate in the sale.”
Participants will be able to register for the offering through the stackstoken.com portal, where STX will be on sale while supplies last via payments in dollars, bitcoin, or ether. $100 USD or the cryptocurrency equivalent is the minimum purchase amount allowed.
A Page Has Been Turned
For his part, Blockstack chief operating officer Muneeb Ali hailed the SEC qualification as a milestone in the wider cryptoeconomic fight to build a new, better internet:
“By inviting everyone, not just accredited investors, to contribute to Blockstack, we can effectively drive the long-term growth of our vision to build a decentralized computing network that will replace the current, siloed version of the internet with one that is open, fair, and user-controlled.”
In the very least the qualification is a milestone insofar as it is unprecedented in America’s nook of the cryptoverse — no ICO has ever achieved similar SEC approval before, with the Commission having proven to be a daunting chokepoint for U.S. token projects in the past.
As legal expert Katherine Wu explained on Twitter, the development indicates Blockstack has been coordinating with the securities watchdog at length — with the effort now having paid off, if the greenlight is any indication.
!! HUGE congrats to the entire @blockstack team (and in particular to their lawyers) for being the first token company to successfully offer tokens publicly under Regulation A+!
Getting qualified for a Reg A+ filing takes a *lot* of work + back and forth with the SEC staff. https://t.co/FMT5EvlW0w
— Katherine Wu (@katherineykwu) July 10, 2019
Zooming out, Blockstack has provided a blueprint for other token projects keen on bringing their assets into the hands of U.S. investors in full regulatory compliance. The takeaway? Deeply engage with the Commission and its requests (and be a viable project, of course), and you’ll be able to play ball in America.
Hear that sound? that's ten thousand blockchain startups calling up lawyers to ask "what the eff is a Reg A?"
Congrats @blockstack on getting your offering qualified!
— Preston Byrne (@prestonjbyrne) July 10, 2019
Now, this isn’t to say that ICO season will come ripping back. But it does show there’s a viable new way to bring token offerings toward the mainstream.
What Is STX?
The Stacks token is the native asset of the Stacks blockchain, which is the heart of the Blockstack network.
In being the platform’s native asset, Stacks tokens work like ether works in Ethereum: as gas to pay for the execution of transactions and smart contract activities. So for those building dapps on top of Blockstack, STX will be used to make those dapps run and help the network’s users manage their data.
Notably, preregistered Blockstack voucher holders who have been approved will be allowed to purchase an initial lot of $3,000 worth of STX at a price of $0.12 per token.
Beyond the 78,333,333 STX set aside for voucher owners, an additional 62,000,000 STX have been earmarked for the token’s general offering valuation of $0.30 and another 40,000,000 for “non-cash consideration,” i.e. to pay for the development of dapps through the Blockstack “App Mining” program.
Of all those tokens, only $50 million worth will be portioned out for retail investors, though that’s $50 million more than what would be allowed in a regular securities offering. Such offerings are open only to accredited investors in the U.S.