A lawyer from a16z’s crypto investment arm has advised against publicly selling tokens in the US for fundraising purposes. Miles Jennings, the general counsel for a16 Crypto, stated in a recent blog post that the US Securities and Exchange Commission (SEC) has made it clear that Initial Coin Offerings (ICOs) fall within the scope of securities laws. Jennings emphasized that even if the tokens being sold are digital assets or shares of stock, if token issuers make promises to investors about funding their operations and delivering future returns, the transactions would be considered securities transactions. The SEC began subjecting ICOs to securities laws in 2017 due to their rising popularity. While the industry has shifted away from public US token sales, Jennings noted that ICOs continue to emerge in new forms, such as “Protocol Owned Liquidity” and “Liquidity Bootstrapping Pools.” However, he advised projects to avoid these schemes and explore alternative ways to raise funds that do not entail legal risks with the securities watchdog. Jennings stressed that public sales in the US should be avoided, and that compliant fundraising through public sales of equity and tokens outside the US or private sales of equity and tokens can be conducted without the need to comply with securities laws’ registration requirements.