US SEC Boss Hester Peirce Suggests Three Year “Safe Harbour Period” For Token Sales

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US Securities and Exchange Commission (SEC) commissioner Hester Peirce has rocked the crypto and blockchain world today with a speech at Chicago’s International Blockchain Congress suggesting that crypto businesses should have a three-year harbour period from their initial token sales before the SEC determine whether they need to comply with the agency’s securities laws.

Amy Davine Kim, Chief Policy Officer, the Chamber of Digital Commerce told Blockchain News:

“Today, SEC Commissioner Hester Peirce announced a proposed safe harbor for certain tokens under the federal securities laws. The Chamber of Digital Commerce encourages efforts to create a path for innovators to create and circulate digital tokens as they develop their networks toward a decentralized or functional technology platform.”

“The proposal exempts transactions involving digital tokens from the Securities Act of 1933 if the token is intended to be decentralized or functional within 3 years, and also contains additional disclosure requirements for the digital token developers. The safe harbor would allow token developers to begin their projects with clear parameters and disclosure requirements as they ideate, define, and begin to develop their solutions.”

“We look forward to working with Commissioner Peirce and her team to develop this proposed Rule, which has the potential to provide a clear path forward for those creating new innovations and solutions leveraging digital tokens.”

The news was broken today by Coindesk:

“The analysis of whether a token is offered or sold as a security is not static and does not strictly inhere to the digital asset,” stated Peirce, who has floated the idea of a safe harbour in the past and Thursday’s proposal appears to be the first formal attempt to make it a reality.”

“The safe harbour is also designed to protect token purchasers by requiring disclosures tailored to the needs of the purchasers and preserving the application of the anti-fraud provisions of the federal securities laws,” according to Peirce’s notes.

Coindesk had access to the proposal:

Also published on Medium.