What Should Be Disclosed in an Initial Coin Offering?

Cryptoassets: Legal and Monetary Perspectives, OUP Press Forthcoming

51 Pages Posted: 17 Dec 2018 Last revised: 24 Feb 2019

See all articles by Chris Brummer

Chris Brummer

Georgetown University Law Center; The Institute of International Economic Law (IIEL); Atlantic Council

Trevor Kiviat

Davis Polk & Wardwell LLP

Jai R. Massari

Davis Polk & Wardwell LLP

Date Written: November 29, 2018

Abstract

Disclosures in initial coin offerings (ICOs) have ranged widely from informative to incomplete to fraudulent. Consequently, advocates for the investing public have, understandably, called for the registration of ICOs as securities to facilitate better disclosures. As this article shows, however, the disclosures required under the 1933 Securities Act often map poorly on to crypto asset products and infrastructures and will provide limited assistance to investors. Many ICO issuances offer non-traditional, non-financial rights that require and involve different pricing considerations than traditional common equity and debt, and are embedded in technical systems unanticipated by the New Deal. ICOs thus require a reconceptualization of longstanding disclosure obligations and safeguards, as well as a revamped approach towards entities tasked with validating disclosures. This article charts key provisions in the Securities Act’s Form S-1, crowdfunding’s Form C, Form 1-A for Regulation A , and Rule 144A to provide just such a policy framework.

Keywords: ICOs; cryptocurrencies; disclosure; 1933 Act; Reg A; crowdfunding; Rule 144A

Suggested Citation

Brummer, Christopher J. and Kiviat, Trevor and Massari, Jai Ruhi, What Should Be Disclosed in an Initial Coin Offering? (November 29, 2018). Cryptoassets: Legal and Monetary Perspectives, OUP Press Forthcoming. Available at SSRN: https://ssrn.com/abstract=3293311

Christopher J. Brummer (Contact Author)

Georgetown University Law Center ( email )

Washington, DC 20057
United States

HOME PAGE: http://www.law.georgetown.edu/faculty/brummer-chris.cfm

The Institute of International Economic Law (IIEL) ( email )

Georgetown University Law Center
600 New Jersey Avenue, NW
Washington, DC 20001
United States

HOME PAGE: http://iielaw.org/member/chris-brummer-2/

Atlantic Council ( email )

1101 15th Street, NW
11th Floor
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United States

HOME PAGE: http://chrisbrummer.com

Trevor Kiviat

Davis Polk & Wardwell LLP ( email )

450 Lexington Ave.
New York, NY 10017
United States

Jai Ruhi Massari

Davis Polk & Wardwell LLP ( email )

450 Lexington Ave.
New York, NY 10017
United States

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