Despite all the hype around initial coin offerings this year, U.S. regulators have yet to offer specific rules on what's legal and what isn't. So a growing number of crypto start-ups are taking compliance into their own hands.
Since early August, at least nine companies have filed token sales with the SEC to raise a total of more than $350 million, according to data compiled by CNBC. The latest was Unikrn, an e-sports betting company backed by celebrity investors including Mark Cuban and Ashton Kutcher. On Tuesday, Unirkn filed to raise $20 million through sales of its digital currency called Unikoingold.
ICOs, which hardly existed before this year, offer a new way for blockchain companies to raise cash without tapping traditional venture investors or the capital markets. Many projects have solicited funds directly from their website even though it may be years before they bring a product to market.
In late July, the SEC issued its first public warning on ICOs, indicating that securities laws may apply to the sale of new digital coins. The SEC later issued another warning about ICO scams and last month charged two companies for ICO fraud.
Even without a clear set of laws, companies are getting the hint.