Reg D Rule 506(b)

Rule 506(b) is the most-used exemption within Regulation D. It lets a company raise an unlimited amount of capital without registering the offering, as long as it does not advertise and sells mainly to accredited investors.

The defining limits of 506(b) are:

• No general solicitation. You cannot publicly advertise the deal. You can only offer it to people with whom you (or your placement agent) have a pre-existing, substantive relationship.
• Investor mix. Unlimited accredited investors, plus up to 35 non-accredited investors who are "sophisticated" (able to evaluate the risks), though adding non-accredited investors triggers heavier disclosure duties.
• Self-certification is allowed. The issuer can reasonably rely on an investor's own representation (for example, in a questionnaire) that they are accredited - no third-party verification is required, unlike Rule 506(c).

Because it allows self-certification and has decades of established practice, 506(b) is the default for relationship-driven raises. The catch is the advertising ban: a public token sale page or social-media campaign is general solicitation and will break a 506(b) offering, which is what pushes many tokenized deals toward 506(c) instead.

As with all Reg D offerings, the securities are restricted, and the issuer must file a Form D, generally within 15 days of the first sale. Eligibility and the sophistication judgment are fact-dependent.

Source: U.S. SEC (sec.gov), as of 2026.