Templum LLC, a company offering regulatory compliant solutions for ICOs as securities and subsequent secondary trading, a competitor to the ICO platform being developed by Overstock’s tZERO, today announced that it has closed a seed funding round totaling $2.7 million. The seed round was led by Raptor Group, Galaxy Investment Partners, Blockchain Capital, and firstminute.capital.
The funding follows Templum’s recent strategic partnership agreement with broker-dealer Liquid M Capital, to launch a US regulatory compliant turn-key solution, known as Templum, for the initial issuance and secondary trading of Initial Coin Offerings (ICOs) as securities. Templum will use the seed capital for operational expansion, product development, and talent acquisition.
Chris Pallotta, Templum Founder, and Chief Executive Officer stated:
“ICOs offer innovative organizations an efficient alternative for raising capital. However, ICOs in their current form can be highly risky for issuers and investors. Templum will provide the necessary transparency, accountability and investor protection to reduce risks and encourage more widespread acceptance of ICOs.”
Bart Stephens, Blockchain Capital Co-Founder, and Managing Partner said:
“Templum has entered the ICO market at the ideal time when compliance and investor protection are top of mind for industry participants. Their solutions provide much needed certainty regarding regulatory obligations, safeguards to protect investors and a vital secondary marketplace for liquidity. We’re excited to partner with Templum to further democratize access to digital assets while bolstering overall market integrity.”
Until recently, the U.S. ICO market has operated in a manner that did not focus on compliance with the U.S. and foreign securities laws. The Securities and Exchange Commission (SEC) released an investigative report on July 25, 2017, concluding that offers and sales of digital assets that are securities by “virtual” organizations in the U.S. are subject to the requirements of the federal securities laws.
Subsequently, some ICOs conducted prior to the SEC’s investigative report could be deemed to have violated securities laws and ICO issuers could be held liable for these violations. In response, Templum and Liquid M Capital recently submitted a letter asking the SEC to grant ICO issuers a grace period of 180 days to remediate any possible violations related to their past ICOs, except those that may have involved fraud.
Summarizing on the letter, Mr. Pallotta said:
“We will continue to advocate for the advancement of the digital asset community that is balanced with the need for regulatory compliance and investor protection. We believe narrowly tailored remedial relief solution for these issuers and investors will support the innovative ICO model while helping issuers meet the necessary regulatory requirements within an established securities framework like the one we offer.”