A new crowdfunding regulations for Initial Coin Offerings (ICOs) have been worked upon by the European Parliament’s Committee on Economic and Monetary Affairs.
The British Member of the European Parliament Ashley Fox, had proposed for ICOs to be included into consideration of their new regulatory draft document framework for crowdfunding that has been actively developing upon since March 2018.
Although all of the suggestions for crowdfunding regulation presented in the draft are not representing a definitive or final solution when it comes to ICOs, they nevertheless do represent the much needed step forward in the right direction that will introduce just the right regulatory measures that are aiming for the most important part of the whole system which is protecting the investor.
When we take into consideration the fact that ICOs really do take a very important role when it comes to funding for tech startups, this new report that outlines the necessity of this kind of regulatory framework is really showcasing the new opportunity and incentive for many ICOs to prove their legitimacy and showcase their readiness to comply with all of the regulatory requirements.
“In order to allow for a competitive Union framework, crowdfunding service providers should be permitted to raise capital through their platforms using certain cryptocurrencies […] ICOs offer new and innovative ways of funding but can also generate substantial market, fraud and cyber security risks to investors. Therefore, [ICOs] should comply with specific additional requirements under this Regulation.”