Debevoise on Blockchain Tokens and Initial Coin Offerings: New Year, New Perspective

Sales of blockchain tokens in so-called initial coin offerings (“ICOs”)[1] exploded in 2017. According to CoinSchedule, a website that tracks ICO (or digital token sale) data, the total amount raised in ICOs in 2017 was $3,700,682,293, which compares to $96,389,917 raised in 2016.[2]

Perhaps not surprisingly, 2017 was also a year of increasing focus by U.S. regulators on ICOs. The Securities and Exchange Commission (the “SEC”) launched a new Cyber Unit and took its first significant enforcement actions against promoters of ICOs.

As the calendar opens on a new year, it seems appropriate to revisit and assess the … Read more

Debevoise & Plimpton discusses SEC’s Proposed Rule on Security-Based Swap Quotes

On September 8, 2014, the Securities and Exchange Commission (the “SEC”) published a proposed rule (the “Proposed Rule”) providing that certain communications involving quotes of security-based swaps will not be deemed to constitute offers of such security-based swaps or of any guarantees of such security-based swaps that are securities for purposes of the registration requirements applicable to offers or sales of securities under section 5 of the Securities Act of 1933 (the “Securities Act”), if the security-based swaps may be purchased only by eligible contract participants (“ECPs”)[1] and are traded on or processed through a trading system or platform that … Read more

Debevoise & Plimpton discusses JOBS Act General Solicitations

In a September 9 letter (“Letter”),[1] the Division of Swap Dealer and Intermediary Oversight (“DSIO”) of the Commodity Futures Trading Commission (“CFTC”) granted exemptive relief permitting general solicitation under certain circumstances by commodity pool operators (“CPOs”) that rely on CFTC Regulation 4.7(b) and 4.13(a)(3). The exemptive relief was issued in response to amendments made by the Securities and Exchange Commission (“SEC”) pursuant to the Jumpstart Our Business Startups Act (“JOBS Act”) to permit general solicitation in certain unregistered securities offerings. The exemptive relief will facilitate the use of Rules 506(c) and 144A(d)(1) by a large number of CPOs, including private … Read more

Debevoise discusses Temporary No-Action Relief for Swaps Between Eligible Affiliate Counterparties

On March 6, 2014, the Division of Clearing and Risk (the “DCR”) of the Commodity Futures Trading Commission (the “CFTC”) issued a time-limited no action letter, extending the temporary alternative compliance frameworks available to “Eligible Affiliate Counterparties” (as defined in CFTC regulation 50.52(a)) to claim an exemption from the mandatory clearing swap requirements for swaps between such counterparties pursuant to CFTC regulations 50.52 from March 11, 2014 to December 31, 2014 (the “Clearing No- Action Letter”).[1] On the same day, the Division of Market Oversight (the “DMO”) issued a time-limited no-action letter, providing relief from the mandatory trade execution requirements … Read more