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⍰ ASK How does the USA regulate crowdfunding for startup companies?

In the U.S., the Securities and Exchange Commission (SEC) oversees crowdfunding for startups to protect investors and market integrity. The 2012 JOBS Act shaped these regulations, especially Title III, enabling equity crowdfunding through registered portals.

Companies participating must meet disclosure rules, sharing detailed business, financial, and risk information. The SEC limits individual investments based on income and net worth, aiming to safeguard investors. Crowdfunding portals must register with the SEC and join a self-regulatory organization (SRO) for compliance.

This approach balances aiding startups in capital formation while preventing fraud for investor protection.
 

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