In America, only the most sophisticated of investors can meet the U.S. Securities and Exchange Commission’s exclusive “Accredited” label. Being an Accredited Investor means having access to the most lucrative, innovative, and, of course, risky investment types. These investment types include private offerings and ICOs.
Currently, to get this exclusive certification, an investor must *checks notes* be rich.
That’s it. As long as you’ve got at least $1 million in the bank or are bringing home $300k a year, you too can be an Accredited Investor—at least until SEC Chairman Clayton makes some changes.
In a speech at the Nashville 36|86 Entrepreneurship Festival in late August, Clayton announced that the SEC would be looking at expanding the opportunities for folks with smaller bank accounts; like, you know, the overwhelming majority of the population of the United States.
“We also should consider whether current rules that limit who can invest in certain offerings should be expanded to focus on the sophistication of the investor, the amount of the investment, or other criteria rather than just the wealth of the investor,” he stated in his speech.
The SEC’s effort parallels other Washington efforts to modernize the Accredited Investor rule. Proving that bipartisanship is only mostly dead, 400 and change members of the House voted in July on a package of bills (called the JOBs Act 3.0) containing updates to the definition of “Accredited Investor.” That bill would expand the definition to include “any natural person the Commission determines, by regulation, to have demonstrable education or job experience to qualify such person as having professional knowledge of a subject related to a particular investment.”
In other words, the new definition would include “smart people.”
While things are very much in the early planning stages at the Commission, the Chairman did say, “The staff is working on a concept release that I expect will bring to the forefront these and other topics on how we can harmonize exempt offerings.”
But just because you know everything there is to know about blockchain technology and ICOs, don’t go on a coin buying spree just yet. It may be a while before the SEC is ready to release the new rules for sophisticated investors. In the meantime, everyone can buy some HoweyCoins—the only ICO endorsed by Consumers’ Research. 😉
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