At a Glance: IPO, ICO, IEO and STOs Compared

  • Initial Public Offerings (IPOs), the process in which private companies offer shares to the public in exchange for shares in a public-listed company, have been around for hundreds of years.
  • Most ICO issuers take the position that they need not comply with national securities regulations if their tokens do not grant investors the right to share in the profits of the companies but merely grant access to the company’s products and services (“utility” tokens).
  • The US’s securities regulator, the Securities Exchange Commission (SEC) takes the position that merely labeling a token a utility token or structuring it to provide some utility does not mean that the tokens are not securities and that most ICOs do in fact need to be registered .
  • Unlike ICOs which are administered by the token issuer directly, IEOs are administered by cryptoccurrency exchanges .

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