SEC Commissioner Hester Pierce
proposed a “safe harbor” for crypto projects
that raise
money before they are sufficiently decentralized.

I am a big fan of “safe harbors”and wrote a bit a few years
ago
about why I like them so much and why a crypto safe harbor
is such a needed and good idea.

There is a chicken and egg problem in financing crypto projects.
These projects need investment capital and community
involvement/buy-in to get to market and begin the process of
decentralization. But the SEC views crypto-tokens as securities
until the crypto-networks are sufficiently decentralized. And so
crypto projects get stuck in this never never land and have to
craft crazy frankenstein financings or risk getting sued by the SEC
(and/or both) in order to raise money and get their tokens in the
hands of community members.

I encourage the SEC to take Commissioner Pierce’s proposal
seriously and adopt a workable safe harbor for crypto projects here
in the US. We have seen the crypto capital markets and so much of
the innovation in the sector move offshore and a safe harbor would
be incredibly helpful in getting it back onshore (I couldn’t help
the nautical metaphor).

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