Gaming startup Pocketful of Quarters secures 'no-action letter' from SEC to launch ethereum token sale
Fri, 26 Jul 2019, 07:28 am UTC
The United States Securities and Exchange Commission (SEC) has given Pocketful of Quarters (PoQ), a gaming rewards firm, a no-action notice to issue tokens on the ethereum blockchain.
As per the letter written by the SEC Division of Corporation Finance, the move allows PoQ to legally sell its Quarters tokens to consumers without the need to register them as securities.
“Based on the facts presented, 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,” Jonathan Ingram, chief legal officer for the SEC’s FinHub wing, wrote.
CONGRATS @BuyQuarters, @weiks & @NYcryptolawyer—this advances the ball for the #crypto industry in the US, one step at a time. Pocketful of Quarters was a key sponsor of the inaugural @wyohackathon—happy to see successes for our sponsor companies! https://t.co/pEyGyZ6Stu— Caitlin Long ???? (@CaitlinLong_) July 26, 2019
The letter noted that the SEC arrived at this decision based on the different representations made by the company about Quarters in the initial request, including stipulations that “PoQ will market and sell Quarters to gamers solely for consumptive use as a means of accessing and interacting with Participating Games.”
Furthermore, the terms also specified that Quarters holders can only transact with PoQ or “Approved Accounts,” which are required to comply with the Know Your Customer and Anti-Money Laundering protocols.
The latest go signal PoQ received from the SEC will allow gamers to buy tokens using USD or ETH, and Quarters can be transferrable between different games. Users do not need to cash-out when they shift to a new game, and they can bring their winnings with them.
“Players can never buy or sell or exchange to anyone except for approved developers, and that’s a key component or our … strategy,” Michael Weiksner, the company’s principal, told CoinDesk.
George B. Weiksner, PoQ’s current CEO, told CoinDesk that he hopes Quarters will enhance the gaming experience of players without spending large sums on various platforms.
Currently, PoQ is reportedly working with Apple and Google to make Quarters token available in the App and Google Play stores, respectively.
Just recently, blockchain-based game studio Horizon Blockchain Games secured $3.75 million in seed funding spearheaded by Reddit co-founder Alexis Ohanian’s Initialized Capital.
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