On Thursday, the popular cannabis culture brand and publication High Times broke new ground as the company announced that its IPO would be accepting Bitcoin and Ethereum as means of payment. This will mark the first Regulation A+ stock offering – indeed the first stock offering of any kind – to do so.
New York-based High Times, a pioneer in the legalization movement and a source for cannabis information since 1974, is about to become a pioneer once again as it announced last week that its upcoming IPO – which will be listed on the NASDAQ public stock exchange – will be the first IPO to accept investments in Bitcoin and Ethereum.
High Times CEO Adam Levin says:
High Times has been at the forefront of popular culture for more than four decades. […] Now we’re taking another step into the future, not only as one of the first cannabis-related brands to go public on the Nasdaq but also as the first to allow Bitcoin and Ethereum as part of our public capital raise.
What is a Regulation A+ IPO?
A Regulation A+ IPO is similar to a traditional IPO but there are key differences that make it advantageous both to the issuing company and to investors. One of the big benefits of a Regulation A+ stock offering is that it allows for a broader investor pool by giving issuing companies the ability to raise money by selling shares to both accredited and non-accredited investors alike.
The NYSE also outlines some additional advantages that a Reg A+ IPO offers US or Canadian companies:
- Issuing companies can raise up to $50 million during a 12-month period using a “public solicitation” of its shares
- The stock offering is exempt from SEC and state securities law registration
- Confidentially submit its offering memorandum to the SEC and enjoy the opportunity to “test the waters” before pursuing a mini-IPO
- A streamlined, expedited review process where the company is required to make its offering memorandum public just 21 days before SEC qualification and the beginning of its roadshow
- Public funding raised through Reg A+ can be combined with private funds from venture capitalists
Reg A+ opens up IPO investing to smaller investors who might otherwise not be able to participate.
What, No ICO?
Apparently not. Despite the fact that there have been several cannabis-related ICOs in the past, Levin maintains that an Initial Coin Offering was never part of the plan for High Times. Even so, he was quick to acknowledge that short-sightedness that excluding such an emerging investor base would have represented:
While we didn’t believe that the ICO process was the right move for our brand, it would’ve been foolish to leave this emerging investor base out as we continue to transform into a diversified media, events and merchandise giant.
As Levin explains:
Cryptocurrencies have created a new investor base across the world – we’re just giving them more stable opportunities for investment.
What do you think about High Times’ decision to accept cryptocurrencies during its IPO? Will other companies jump on the bandwagon? How will this impact the cryptocurrency market? Let us know in the comments below.
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