|Occupation||Director of the Corporation Finance Division|
|Employer||U.S. Securities and Exchange Commission|
William Hinman served as the director of the Division of Corporation Finance (CorpFin) at the U.S. Securities and Exchange Commission (SEC) starting in May 2017. The agency announced on October 27, 2020 that Hinman would leave the SEC before the end of the year.
Crypto and CorpFin
The division director came to the attention of the cryptocurrency industry on June 14, 2018 when he said, "based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions." The following November, Hinman told conference attendees at D.C. Fintech Week that the SEC intended to provide the cryptocurrency industry with "plain English" guidance on differentiating tokens that are securities from other types of coins and tokens for the purposes of U.S. securities laws.
"Plain English" Guidance
In November 2018, Hinman announced that he was heading up the development of a document that would provide "plain English" guidance for companies considering launching initial coin offerings. The document was published on April 3, 2019.
"We try to give an example of what might be a security and also what might not be," he told Coindesk the day the framework document was published. "We’re also trying to say that we recognize in certain cases the instrument is offered and sold for actual use...one thing we’re trying to make clear in this analysis is that not one of these factors is dispositive, you have to look at the whole mix.” The document, which was entitled, "Framework for 'Investment Contract' Analysis of Digital Assets," emphasized the use of the Howey Test as a key tool for coin issuers and business owners who are unsure if their product could be considered a security. The document also firmly stated that companies offering securities products must be registered with the SEC before beginning the sale of digital assets that can be considered securities.
Hinman was named director of the SEC's Division of Corporation Finance by the SEC in May 2017 after he had spent 37 years in private legal practice. Hinman retired from a partnership with Simpson Thacher & Bartlett, where he worked in their Silicon Valley office. Prior to that he was the managing partner of Shearman & Sterling's San Francisco office. During his private career, Hinman advised public and private companies in corporate finance matters including in the technology and e-commerce areas.
At the SEC, Hinman has advocated for measures to facilitate capital formation, including permitting many entities to file more information in their pre-IPO draft registration applications on a confidential basis.
Hinman is a graduate of Michigan State University. He received a law degree from Cornell University Law School, where he was a member of the Editorial Board of the Cornell Law Review.
- Press Release: Division of Corporation Finance Director Bill Hinman Announces Intention to Conclude His Tenure Later This Year. U.S. Securities and Exchange Commission.
- Digital Asset Transactions: When Howey Met Gary (Plastic). U.S. Securities and Exchange Commission.
- SEC Official Says 'Plain English' Guidance On ICOs Is Coming. Coindesk.
- SEC’s Crypto Token Framework Falls Short of Clear and Actionable Guidance. Coindesk.
- Framework for “Investment Contract” Analysis of Digital Assets. Coindesk.
- Behind the push at the SEC to make it easier for IPOs to be launched. MarketWatch.
- Press Release. U.S. Securities and Exchange Commission.