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Investment Cancellation & Regulatory Refund Constraints ​

Cancelling an Investment is subject to custody, eligibility, destination, and evidence requirements. The general normal, failure, and recovery handoff is Cancel, recover, and hand off work. The Investor-facing request and Administrator decision remain detailed in Cancelling a Submitted Investment.

Cancellation is a regulated event. The Issuer, Administrator, and responsible compliance owner record the decision and its basis.

Custody and escrow constraints ​

For a contingent offering, funds remain in the qualified escrow or other segregated account until the applicable closing conditions are met. The Issuer cannot release those funds to its operating account before the custodian or settlement owner authorizes the release.

For on-chain payments, a smart contract can apply the fund's stated escrow and refund rules. Its behavior remains subject to the deployed code, offering terms, and owning service; refunds are not inherently trustless or automatic.

Investor cancellation and rescission criteria ​

  • A cancellation request identifies the Investor, Investment, reason, current status, and permitted next action.
  • A Regulation A Subscription Agreement grants a right to rescind before the official closing notice. The agreement controls the window.
  • An applicable EU crypto-asset distance transaction typically has a 14-day withdrawal period. The existing immediate-delivery waiver and exceptions for tokens the Investor has received and traded apply, and the legal owner determines whether the rule covers the transaction.
  • A cancellation request is not a completed refund, reversal, or release. The owning service records each result.

Required cancellation and refund criteria ​

Cancellation and refund are required when a contingent fund misses its required target by the stated deadline. They are also required when a material change requires affirmative reconfirmation and the Investor's reconfirmation window expires without it. The Issuer cannot block a required return. An Issuer or authorized Administrator can terminate a fund before closing when the applicable terms permit it, and a regulatory or compliance decision can halt the fund.

See Material Change and Offer Cancellation for related constraints.

Refund destination and evidence ​

Refunds go strictly to the originating bank account or originating crypto wallet. The platform must not redirect a refund to a third-party destination. The record identifies the payment rail, source or wallet, amount, provider or chain operation, status, and settlement result. It also preserves:

  • The cancellation or rescission request, reason, approval or denial, and responsible owner.
  • The fund and Investment status before and after the decision.
  • Escrow release or return instructions and the provider or chain response.
  • Investor notification, expected timing where provided by the rail, and completion or recovery evidence.

A cancellation request and a refund settlement are separate records. Settlement is complete only after the owning service records the provider or chain result. Refund timing and automation depend on the payment rail and owning service.

Applicable references include SEC Rule 15c2-4, BSA/AML, and MiCA controls. The responsible owner determines which requirements apply to the fund and jurisdiction.