Blockstack began selling regulated digital coins on Thursday morning, one day after the U.S. Securities and Exchange Commission granted approval for the blockchain startup to hold one of the first offerings of its kind.
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Officials approved the $28 million offering through Regulation A+, a provision which allows companies to pursue early funding without submitting to the full disclosure requirements and steep costs of an initial public offering. Blockstack’s public offering essentially functions as a regulated form of an initial coin offering, a popular fundraising mechanism for cryptocurrency startups that drew the SEC’s ire in recent years.
“We decided to work with US regulators to figure out a legal framework for our token offering because we wanted to open our token offering to the general public, without excluding the US. We believe that this was the harder but better path to take,” Blockstack said in a blog post.
The SEC declined to comment. The Wall Street Journal was first to report the SEC’s approval.
Under Regulation A+, companies are permitted to raise up to $50 million from investors over a 12-month period. The method differs from a traditional IPO in that investors will receive tokens for use on Blockstack’s platform rather than shares in the company itself.
“[The offering] 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,” the company added. “This means everyone from general enthusiasts, to longstanding Blockstack supporters, to accredited or non-accredited investors alike — in the U.S. and globally, can participate in the sale.”
The offering comes as other blockchain-powered initiatives draw growing public interest. Facebook announced last month that it plans to launch Libra, a cryptocurrency managed by an independent entity, in 2020.