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As the fall equinox approaches we have a final summer bombshell - a 100% compliant exchange and a growing inventory of security, commodity and other types of tokens that pass SEC scrutiny, built on BitShares, which itself has been deemed a “clean coin” by the Tokens & Exchange Self-Regulating Body (TXSRB.org) -- and China as well!

The current BitShares exchanges will of course continue to exist and BitShares members can choose the exchange that suits their needs. The new exchange licensed by Stokens, Inc. and called the Stokens Exchange (Stokens.com), will require KYC/AML for membership and only list tokens deemed legal by the SEC and other related global regulating bodies where members reside.

John Gotts, the chairman and founder of Stokens and the TXSRB, engaged more than fifty ex-SEC attorneys, some of whom helped write much of the JOBS Act, Regulation A and other key security laws, to design the framework of the TXSRB and Stokens.com regarding compliance and licensing with funds and public offerings. The top attorneys on their team gave their take on his analysis of what the token industry needs to "clean up its act.” Here are a few takeaways from their conversation:

•	Most ICOs were conducted illegally and now trade illegally. Foundations who try to comply and restart may have to pay fines and return funding.
•	Stokens and the TXSRB provide the proper methods to create a self-regulating body and a legal site for private companies to raise money from accredited & non-accredited US investors, who may trade the digital representation of their investment (a token or tokens) legally.
•	They expressed their opinion that Stokens and the TXSRB stand alone in the US and perhaps globally in their legal methods and plans and may get a seat in D.C. on the committee reviewing regulation on crypto investments for the United States Congress.  They believe he’s designed the future for crypto investment and trading.

John came away feeling that of all the global exchanges perhaps only Coinbase would not be shut down if/when the SEC decides to act. He also learned what exchanges would have to do to “clean” the exchange operating in the USA:

•	Delist tokens deemed unregistered securities.
•	Don’t charge fees for trading without a broker/dealer license.
•	Don’t charge fees for ICOs based on a percentage of what is raised, equity in the company or any success fee without a broker/dealer license or working as an agent for a broker/dealer.
•	Don’t allow trading of security tokens without an SEC exchange license.
•	Complete KYC/AML on all members for anti-money laundering.
•	Provide auditable transparency – Each exchange must be audited.
•	Provide educational material on a regular basis in a clear, visible place on any exchange or ICO website or related app explaining the risks of trading tokens and the possibilities of fraud and loss of funds.
•	Provide clear guidelines to members on best practices for avoiding & reporting theft or fraud.
•	Provide member wallets and trading with a technically secure exchange.

Embracing the TXSRB and SEC rules, regulations & laws will make the Stokens Exchange (powered by the BitShares Network) the first and most legally compliant way for a company to successfully secure funding without the chance of a shutdown, lawsuit or investigation.  The Stokens Exchange is the future of crypto and it will be built on the BitShares blockchain.

## BitShares was designed to support this from the beginning.

BitShares has always provided all the tools and utilities needed to allow users to comply with the regulations and laws that apply to them.  These vary widely with token type and jurisdiction, so it must be the responsibility of the individual token issuers and exchanges that build on top of the BitShares platform to ensure that they are fully compliant.  The necessary artificial intelligence does not exist for an unmanned blockchain to analyze whether every offering and user has complied with all the relevant rules and constraints.

But BitShares will enforce those rules, including constraining each and every asset to the rules on who can own them and what they can do with them.  If you created a token and didn’t tell BitShares the right rules to enforce, you may have broken the law in some jurisdiction.  Better check it out.

Since this is complicated and constantly changing, I applaud the efforts of Stokens.com and TXSRB.com to provide a turn-key exchange with the rules built-in for (eventually) every jurisdiction in the world.  This brings a whole new level of comfort to those who want to do the right thing, but lack the resources to figure it out on their own.  

[Huffington Post Article](http://www.huffingtonpost.com/entry/the-sec-has-set-its-sights-on-cryptocurrency-exchanges_us_59c2ae9be4b0c87def8834ab)
[Protect Yourself from the Coming Crypto Crackdown](http://www.huffingtonpost.com/entry/protect-yourself-from-the-coming-crypto-crack-down_us_59c11f48e4b0c3e70e7427c9)


Cheers!

**Stan Larimer,** President
[Cryptonomex](https://cryptonomex.com)
*The Godfather of  [BitShares](https://bitshares.org) and [the HERO](https://sovereignhero.com)*

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#### **About the Author -- Stan Larimer**
[Follow Me On Steemit - The Social Media Platform That Pays](https://steemit.com/@stan)
[Please Connect To Me On Linkedin!](https://www.linkedin.com/in/stanleylarimer)

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