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Initial coin offerings bypass rules to raise millions of dollars

The latest twist in online fundraising allows tech entrepreneurs to do away with the hassle of dealing with regulators

New York

A NEW crop of technology entrepreneurs is forgoing the usual routes to raising money. The entrepreneurs are not pitching venture capitalists, selling stock in an initial public offering or using crowdfunding sites such as Kickstarter.

Instead, before they even have a working product, they are creating their own digital currencies and selling "coins" on the web, sometimes raising tens of millions of dollars in a matter of minutes.

The pitch is that once the products are up and running, the currencies - with names such as BAT, Mysterium and Siacoin - will be redeemable for services like data storage or anonymous internet access, and could appreciate in value in the meantime.

Known as initial...

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