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Crypto Law/Level V · Builders and launchers/5.1 Launching a token/Lesson 1

Fair launch or presale

Two ways to put a new token on the market, and why selling it before launch to fund the build draws in US securities law, while a fair launch shifts the legal risk to what the creator says about it.

Education, not legal, tax or investment advice. Crypto law differs between countries and states and changes often. Check the current rules where you live with a qualified lawyer or tax adviser before you act.

The lean path

The cheapest, lowest-tax, simplest and most private route the law allows, best first. Each step names the rule it rests on and the condition that keeps it lawful.

  1. Fair launch with no presale, no reserved insider allocation and no roadmap promises: no SEC filing and no fee; Aguilar v. Baton (S.D.N.Y., 31 Aug 2026) found no common enterprise, but it is a pleading-stage ruling from one district court.
  2. Need to raise money from US buyers? Rule 506(b) of Regulation D allows an unlimited private raise without registration; file the free Form D on EDGAR within 15 days of the first sale, and do no general solicitation.
  3. Selling only to non-US buyers can use Regulation S, which needs no SEC filing, but only if no selling efforts are aimed at the US and resales do not flow back to US buyers.
  4. EU offers to fewer than 150 people per member state, totalling €1,000,000 or less over 12 months, or given free, need no MiCA white paper; the exemption is lost once you announce plans to seek admission to trading.
  5. Regulation Crypto Assets (proposed 18 August 2026) would add a $5 million startup exemption, but it is not law until adopted; until then, structure any presale under an existing exemption.

MaterialsSEC Release No. 33-11412 (17 March 2026), section IV on how crypto assets become subject to an investment contractThe 31 August 2026 opinion in Aguilar v. Baton Corporation Ltd. (S.D.N.Y.), the Pump.fun class actionArticle 4 of the EU’s MiCA Regulation (2023/1114) on offers to the publicA written launch plan listing every way tokens will leave the creator’s hands

Wonder

  1. If nobody pays me before launch, can my token still end up part of a securities offering?
  2. Is a presale illegal, or just regulated?
  3. Can calling a launch ‘fair’ get a creator sued?

Explore

  1. A presale sells tokens, or a promise of future tokens, to buyers before public trading begins, usually at a discount, to raise money for building a project. A fair launch is an industry term, not a legal one: the token reaches the market with no presale and no reserved insider allocation, so the creator and the first buyers face the same price and terms, often on an automated bonding curve (lesson 5.1.4). Neither label settles anything in law. In the United States what matters is what money was raised, where it went, what the creator promised, and whether the launch really matched its description.
  2. A presale is the textbook investment contract. Buyers pay money, the proceeds are pooled in the issuer’s treasury, and buyers expect the team to build whatever will give the token value (lessons 3.1.2 to 3.1.4). The SEC’s interpretation of 17 March 2026 (Release No. 33-11412) covers both common forms. In an initial coin offering the tokens are delivered at once; under a ‘simple agreement for future tokens’ (SAFT) they are delivered later. In either case, the SEC says, the sale happens when the agreement is signed, and the tokens become subject to the investment contract at that moment, whenever they arrive.
  3. That does not make presales unlawful. It means they must be registered under Section 5 of the Securities Act or fit an exemption, such as Regulation D for private placements or Regulation S for offshore sales (lesson 3.2.6). Telegram’s private sale of Grams and Kik’s presale both lost in court because early buyers were treated as part of a wider public distribution (lesson 3.1.6). On 18 August 2026 the SEC proposed Regulation Crypto Assets, with a startup exemption of up to $5 million over four years and a fundraising exemption of up to $75 million a year. It is a proposal, not law; comments are due by 20 October 2026.
  4. A fair launch removes the pooled fundraising, and a court has noticed. In Aguilar v. Baton Corporation, the class action over the Pump.fun launchpad, Judge Colleen McMahon of the Southern District of New York held on 31 August 2026 that two memecoins sold on bonding curves were not plausibly investment contracts. The SOL that buyers paid sat in a token-specific contract and was not alleged to fund any common undertaking, so there was no common enterprise, even though one token’s promoter had advertised a roadmap and ‘222,222× upside’. The SEC’s 2026 interpretation separately treats typical memecoins as digital collectibles, which are not securities (lesson 3.2.3).
  5. That protection is narrower than it looks. The ruling came from one district judge at the pleading stage, and no appeals court has addressed it. Under the SEC’s interpretation, what creates an investment contract is the issuer’s own promises of essential managerial work, made before or at the sale, so a fair-launch token whose creator posts milestones, a team and a funding plan can still be caught (lesson 5.1.3). And ‘fair’ is itself a factual claim. The same opinion let racketeering claims proceed, finding that the CEO’s posts calling Pump.fun an ‘unruggable fair launch platform’ and an ‘even playing field’ could be wire fraud if insiders really got early access (lesson 6.2.4).
  6. Other places draw the line differently. In the European Union, MiCA requires anyone offering a crypto-asset to the public to be a legal person and to publish a white paper, unless an exemption applies: for example, offers to fewer than 150 people per member state, offers totalling no more than €1,000,000 over 12 months, or tokens offered for free. Those exemptions fall away once the offeror announces an intention to seek admission to trading (lesson 3.3.1). A practical check: write down every route by which tokens leave the creator’s control, who pays what and when, where the money goes, and what each buyer was told at that moment.

Key facts

  • SEC Release No. 33-11412 states that in a SAFT the sale occurs when the agreement is entered into, so the tokens become subject to the investment contract then, regardless of when they are delivered.
  • On 18 August 2026 the SEC proposed Regulation Crypto Assets, including a startup exemption of up to $5 million over four years and a fundraising exemption of up to $75 million per 12 months.
  • On 31 August 2026, in Aguilar v. Baton Corporation Ltd. (S.D.N.Y.), the court dismissed Securities Act claims over the FRED and GRIFFAIN memecoins because the plaintiffs had not pleaded a common enterprise.
  • The same opinion allowed RICO claims based on alleged wire fraud and unlicensed money transmission to proceed against Pump.fun’s operator and its three co-founders on behalf of two plaintiffs.
  • MiCA Article 4(2) exempts from the white-paper requirement offers to fewer than 150 persons per member state and offers whose total consideration does not exceed €1,000,000 over 12 months.
  • Under MiCA Article 4(4), those exemptions do not apply once the offeror communicates an intention to seek admission to trading.

Exercise nine, six, three, one

9CollectList up to 9 token launches you know of or can look up (some lists will be shorter), noting for each whether there was a presale, a private round, a reserved team allocation or a fair launch.
6ClusterSort them into 6 categories: registered or exempt presales, unregistered presales, private rounds with later public trading, bonding-curve fair launches, fair launches with a published roadmap, and launches whose terms you could not find.
3DistillReduce the 6 to 3 groups: launches where buyers’ money funded the build, launches where it did not, and launches where you cannot tell from public information.
1CrystallizeWrite 1 sentence explaining, for one launch on your list, which fact would matter most to a US court deciding whether its first sales were part of an investment contract.

Fact check

Dates, figures and claims checked against the published sources listed below.

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