In an open letter to the SEC via Facebook, venture capitalist Tim Draper spoke about the recent SEC decision regarding DAO tokens as securities.
Draper offered a series of comments regarding the nature of ICOs and the reasons why the SEC decision was preemptory and too far-reaching. Draper specifically stated his desire that tokens issued prior to October 30 of this year be grandfathered in as non-security instruments. This would obviously include his own ICO of Bancor, which, he argues, would inspire a sense of innovation in a land of opportunity.
He did, however, agree that there should be some regulation, albeit light, on the sale of coins to investors. The same had been suggested by a number of other investment groups prior to the SEC announcement.
In a spirit of clarity, Draper suggested a series of guidelines to manage the status of tokens as securities.
1. If the purpose of a token is for investment, it must register with the SEC.
2. If the purpose of a token is for societal transformation, and all proceeds go to the support and development of the token, it need not register.
3. If the purpose of a token is to raise money for a company, and the money is used to support the company, it must register with the SEC.