Stacks ($STX ) has a unique characteristic in the world of cryptocurrencies: it was the first token approved by the #SEC (U.S. Securities and Exchange Commission) to be sold publicly under a regulated framework. This was achieved because Blockstack PBC, the company behind Stacks, decided to register the #STX offering under Regulation A+ in 2019, a mechanism designed to help startups and small businesses raise funds transparently and legally in the U.S.
🟧 Keys on how this approval was achieved:
1. Regulation A+:
This framework allows companies to raise up to 50 million dollars per year through a public offering.
Unlike other cryptocurrencies that conduct initial coin offerings (ICOs) without regulation, Stacks opted for a more traditional path to comply with securities laws in the U.S.
2. Thorough SEC review:
The SEC evaluated the business model, the functionality of the STX token, and the associated risks for investors.
It approved that the sale of STX tokens is considered a security under U.S. laws, meaning it complies with the same rules as stocks or bonds.
3. Legal and financial transparency:
Blockstack had to disclose financial, operational, and risk information to the public, something uncommon in the crypto market.
This created a precedent in which a cryptocurrency operated under the legal framework of securities.
🟧 Advantages of SEC approval for #Stacks :
1. Regulatory compliance:
Stacks avoids the risk of being sued or banned in the U.S. as has happened with other cryptocurrencies (e.g., Ripple and its token XRP).
Compliance with the SEC allows it to operate with legal clarity, which is attractive to financial institutions, companies, and large investors seeking regulated projects.
2. Increased confidence for investors:
Institutional and traditional investors view a regulated project more favorably, as regulatory compliance reduces fraud risks and ensures transparency.
This can attract a more conservative audience that typically stays away from the crypto ecosystem.
3. Access to capital in the U.S.:
By registering under Regulation A+, Stacks can raise funds from the general public, including retail investors, without violating U.S. securities laws.
This opens the door for STX to be listed on regulated U.S. exchanges, where other cryptocurrencies face restrictions.
4. Competitive advantage over scrutinized projects:
Many cryptocurrencies face legal issues for being considered unregistered securities under U.S. laws (e.g., Solana, Polygon, Binance Coin).
Stacks, being approved as a registered security, can operate without fear of regulatory restrictions, giving it long-term stability.
Conclusion:
Stacks has a strategic advantage over its competitors by being the first token approved by the SEC. This provides a level of legitimacy and access to regulated markets that most cryptocurrencies lack. Although technology remains a crucial factor for its success, this regulatory foundation allows it to stand out in a market where regulatory uncertainty is high.
So relax, we are moving upwards, sooner or later 👊
