CALIFORNIA, USA – Venture capitalists have expressed their interest in cryptocurrency and blockchain. According to CoinDesk data, start-ups recorded their all-time high record of $434 million for three months starting December. In a recent interview, Alyse Killen, Stillmark managing partner, said that they are happy with the way things are changing for the better in the blockchain industry.
U.S. SEC’s assessment of the token industry indicates venture capitalists’ increased attention in equity which is a good sign of business growth.
According to Frank Meehan, partner at SparkLabs Group, a company that continues and has ICO will give his equity more value which is the reality right now.
Last year, SparkLab funded $100 million in a blockchain project. The fund was used wisely with investments in six corporations. They are entitled to a discount if they invested in the company’s ICO. Even though the sales of tokens goes on, it does not change the strategy of some investors. They would wait and invest in a mature company and watch out for parameter changes. Now, this is the challenge for those who are starting as they have to accumulate equity funds for product improvement and publicizing.
On March 6, a letter was made public to address this issue. According to the U.S. Treasury Department a small player that will issue tokens will be deemed as transmitters of money. This will force them to adhere to bank-secrecy and KYC procedures. SEC Chairman Jay Clayton believes that every ICO is a security which most of them denied this fact.
This situation has led investors to buy tokens that are associated to security tokens or equity which do not bear regulatory surprises. On March 8, the Security Token Association was announced by Jeff Pulver. It is a business association in Washington concentrating on tokens that are identified as securities.
There is a platform called Securitize.io that caters tokens issued and related to the revenue and equity of a company. Co-founder Jamie Finn confirmed that even if it was only launched last year, there are already beyond a hundred start-ups that joined.