Regulation D vs Regulation S vs Regulation A+: Which Is Right for Your STO?
Once you understand that your STO must comply with U.S. securities laws, the next question becomes:
“Which exemption should I use?”
This decision determines who you can raise from, how you market, and how your offering is structured.
The Three Primary Paths
Most STOs use:
- Regulation D (Reg D)
- Regulation S (Reg S)
- Regulation A+ (Reg A+)
Regulation D (Reg D)
Allows raising from accredited investors.
Key Features:
- Unlimited capital
- Accredited investors only
- Public marketing allowed (with verification)
Limitations:
- No retail investors
- Restricted tokens (typically 1-year lockup)
Regulation S (Reg S)
Allows raising from non-U.S. investors.
Key Features:
- Offshore investors only
- Often combined with Reg D
Limitations:
- Cannot target U.S. investors
- Requires strict compliance controls
Regulation A+ (Reg A+)
Allows raising from both accredited and non-accredited investors.
Key Features:
- Up to $75M per year
- Retail participation
- SEC qualification required
Limitations:
- Expensive and time-consuming
- Ongoing reporting
Common Mistakes
- Choosing based on cost
- Ignoring investor strategy
- Misunderstanding liquidity
- Poor hybrid structuring
Final Thoughts
These exemptions define your entire offering strategy.
Want Help Structuring Your STO?
Inside the foundation, we help founders choose and implement the right structure.
