Initial Coin Offerings (ICOs) have gained massive popularity and adoption over the last decade due to their practical uses and advantages over other traditional ways of raising capital. They provide an incredibly simple and effective way for projects and startups to raise large amounts of capital quickly and affordably.
IPOs, on the other hand, are slow and cumbersome by comparison. It can take a long time to obtain the relevant regulatory permissions, and there are often high barriers to entry for smaller projects and startups. In this article, we look at some of the ways that ICOs can be used, and the best countries in which to launch a successful ICO.
Best ICO Friendly Countries
These countries are the most-friendly ICO based upon a number of indicators which can be found here and here.
- Cayman Islands
Switzerland has turned into the main country on the planet for ICOs. The administrative experts in Switzerland have been exceptionally strong and open to blockchain innovation. To such an extent that the town of Zug in Switzerland has warmly become known as “Crypto Valley”, because of its crypto-accommodating position and the big number of ICOs which have occurred there.
As of late, Switzerland has been dealing with growing all the more an administrative structure for ICOs and digital currency overall. These are controlled by the Swiss Financial Market Supervisory Authority (FINMA).
A huge number of successful ICOs have been held in Singapore due the conducive environment they offer on all fronts. In order to launch an ICO in Singapore, the company must register as a foundation and obtain KYC and AML compliance, after which it can proceed with the ICO.
ICOs in Singapore are overseen by the Monetary Authority of Singapore (MAS). However, the MAS will only regulate coins and tokens if they are deemed a security under the Securities and Futures Act (SFA).
This occurs when the purchasers of the cryptocurrency have a direct interest or ownership in the issuer’s assets or property. As such, individuals are advised to only invest in cryptocurrencies which are not securities. These ICOs are largely unregulated, and thus experience a great amount of freedom and potential for innovation.
Russia has been a strong supporter of cryptocurrencies and blockchain technologies right from the word go. President Vladimir Putin showed great interest in Ethereum’s founder, Vitalik Buterin, and the government has even proposed plans to introduce their own national cryptocurrency.
This has made it a conducive and friendly environment for those looking to launch an ICO. Up until now, the cryptocurrency industry and ICOs in Russia have been largely unregulated, but this looks set to change in the near future. Russia has begun establishing plans for greater regulation of the industry. It is unlikely that these regulations will stifle the industry given Russia’s positive stance towards cryptocurrency.
Estonia is attractive as a top country to launch an ICO for two reasons: firstly, there are absolutely no laws in place which regulate the practice of holding an ICO, leading to tremendous freedom and innovation potential. Secondly, Estonia has taken a generally friendly stance towards ICOs and cryptocurrency, meaning that any regulation which might be established in the future is likely to be favorable.
Estonia’s openness towards cryptocurrency was highlighted when one of their government agencies even proposed launching their own cryptocurrency token as a compliment to their e-residency program.
The British Overseas Territory of Gibraltar has led the way in terms of successful regulation of cryptocurrencies and ICOs. Cryptocurrencies in Gibraltar are governed by the Gibraltar Financial Service Commission (GFSC). The most important aspect of this regulation is that, unless a cryptocurrency is deemed to be a security, tokens are legally classified as commercial products. This leads to a great amount of freedom and accessibility by the public, and makes Gibraltar an ideal place to hold an ICO.
Cayman Islands marks all the crates as the right purview for an ICO. This is obvious as they are now famous as an alluring seaward monetary community for organization fuse, banking, and general expense effectiveness. They have now expanded their perspectives to incorporate the blockchain and digital money area.
Cayman Islands was indeed home to one of the biggest and best ICOs ever, that of Block.one and their dispatch of the EOS cryptographic money. From that point forward, numerous others have gone with the same pattern and held their ICO in the positive Cayman Islands.
Not commonly known as an attractive offshore financial centre, Israel is interestingly an advantageous jurisdiction to launch an ICO.
There is a specialised committee in Israel which was formed specifically for the purpose of overseeing cryptocurrencies and ICOs. They are also responsible for establishing the future of cryptocurrency regulation in Israel.
The major advantage is that the committee has displayed an altogether favourable attitude towards blockchain and cryptocurrency technologies, going so far as to express their wishes to turn Israel into an ICO hotspot. This indicates that the future of ICOs and cryptocurrency in Israel will flourish, and regulation will likely be favourable in the long term.
Initial Coin Offerings provide an exciting new model for raising capital efficiently. Due to the fact that they involve such a revolutionary and unchartered business sector, there is also a lack of clarity around how they should be regulated, with distinct disparities across different countries.
For this reason, the decision of where to launch an ICO is one of the most important ones to make, as it can ultimately be the difference between success and failure.