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SEC issues first no action letter for Ethereum-based token

Yogita Khatri

The U.S. Securities and Exchange Commission (SEC) has approved the first-ever Ethereum token sale from blockchain-based gaming startup Pocketful of Quarters (PoQ).

In a no-action letter published Thursday, the SEC Division of Corporation Finance said that PoQ may sell its Quarters tokens (based on ERC-20 standard) without registering them as securities.

“The Division will not recommend enforcement action to the Commission if, in reliance on your opinion as counsel that the Quarters are not securities, PoQ offers and sells the Quarters without registration under Section 5 of the Securities Act and does not register Quarters as a class of equity securities under Section 12(g) of the Exchange Act,” said Jonathan Ingram, chief legal advisor for the SEC’s FinHub wing.

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