CO Securities Commissioner issues first interpretation that blockchain token is not a security to Foundry Legal aerospace client

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Colorado’s Department of Regulatory Agencies, Division of Securities opined on Tuesday, February 26 in an interpretive opinion that a digital asset to be developed by a Colorado aerospace technology company would not be considered a security under Colorado securities laws.

Foundry Legal requested the opinion on behalf of its client, SpaceBridge Logistics, Inc.  The company asked the Division to clarify whether a digital asset issued for the consumptive purpose of exchanges for in-space repair and maintenance services was not a security.  The Commissioner said that  agreed, finding that the Division “does not consider these activities to meet the definition of a ‘security’ under § 11-51-201, C.R.S.”

The Division further stated:

Based on the facts and representations that are set forth in your letter, specifically with respect to the SpaceBridge Foundation’s (“the Foundation”) creation, issuance, and exchange of SpaceCredit, the Division does not consider these activities to meet the definition of a “security” under§ 11-51-201, C.R.S. Since SpaceCredit is not a security, there are no registration requirements or need for your client to seek an exemption from registration.

Colorado’s securities statute largely mirrors the federal securities laws.  While a state regulator’s opinion would not have a binding legal effect on any enforcement action brought by the U.S. Securities and Exchange Commission, the opinion marks one of the first times a state regulator has issued specific guidance about the classification of a particular cryptographic blockchain token as a “security” under a state law. 

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Foundry Legal is a law practice.  We primarily focus on data privacy, emerging technology companies and social impact organizations, and capital formation through private securities offerings and strategic investments/acquisitions. 

Occasionally we will find an issue that really, really goes against something we stand for and when that happens we won’t hestitate to get involved.  

The firm serves clients across a range of industries, including new agriculture, financial institutions, aerospace, and professional services.  We are in Denver, Colorado.  Other stuff about us

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