The Securities and Exchange Commission, or SEC, straight Change the definition of the term “accredited investor” to make the pure capital requirements more flexibleafter announcing these plans in December 2019.
Investors accredited in the United States enjoy special privileges with the SEC; H. can participate in certain types of simplified securities sales such as Regulation D.
The SEC noted that the above definitions were based on certain income and equity criteria.that did not take into account your actual “financial sophistication”. In the case of the United States These requirements were $ 1 million in net worth or stable income of at least $ 200,000 per year.
The criterion is now expanded as “The result of years of efforts by the Commission and its staff to examine and analyze approaches to revising the definition of the accredited investor”said the SEC chairman, Jay Clayton.
The details are not yet entirely clear However, the new definition allows individuals to qualify as accredited investors based on “professional certifications, designations or diplomas or other credentials issued by an accredited educational institution”.
These educational institutions will be named at a later date at the discretion of the SEC. It is not clear what types of institutions could be accredited for these purposes and whether specific training or general education in business and finance would be required.
Further minor extensions of the criteria include “knowledgeable employees” of private investment funds and family offices with assets under management of more than USD 5 million.
The decision could be compatible with cryptocurrency-based fundraisingThis would add to the list of potential investors for security token offerings. However, it remains to be seen whether the new measures will be widespread enough to add a significant number to the pool of accredited investors.