Gibraltar financial regulators pay attention to ICO growth and issue warnings

nRampage comments: encrypted money ICO financing from the beginning of last year, rising, this year is the explosive growth. Governments began to consider monitoring such activities, such as the recent Gibraltar Financial Services Committee. However, as a convenient and rapid way of financing, ICO sponsors companies often only white papers and imperfect business models, prone to risk. So you can through supervision, to limit the participation of investors to prevent the loss of funds for retail investors.n
nTranslation: Annie_Xun
Global regulators recognize the huge amount of money flowing in the ICO, and the recent talk about ICO is the Gibraltar Financial Services Commission (GFSC).n
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Gibraltar – Financial Centern
British Overseas Territories Gibraltar is located in the south of Spain, is the global financial center. Large international finance companies are stationed here, benefiting from low tax rates, the EU single market and a sound legal system. Casino and finance companies are Gibraltar’s growth drivers. Experts have argued that Gibraltar will be the ideal place to create a Bitcoin fund.n
ICO increased, GFSC said in a statement that the regulatory framework for the use of block chain storage and transfer value of the company, plans to complete in January 2018. The agency warns investors that ICOs are risky and speculative, and that investment activity participants are best at risk experts.n
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The United States and China have actedn
The Securities and Exchange Commission (SEC) regularly publishes ICO investment risk warnings. July 2017 issued a notice announcing that ICO tokens may be securities, so ICO must comply with all securities product specifications and regulations.n
Although the SEC found that the ether-based DAO actually constituted a securities product, it did not raise an allegation and act as an opportunity to educate the emerging industry. China’s recent action against ICO is sudden. In September 2017, China banned all ICOs and classified them into illegal financing. China also requires all organizations and individuals to return funds raised by ICO.n
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Investors frenzy in 2017n
ICO frenzy broke out in 2017, and in 2016 the ICO grew from $ 250 million to the current $ 1.5 billion (the end of 2017). ICO frenzy began in the first few months of 2017, the proportion of intra-sectoral expansion of the problem. Capital investment non-bit currency encryption currency, resulting in a very high level of market value.n
Leading many companies to plan to launch ICO, issuing tokens for business development. Because the price of these tokens after the listing is often rising, so investors to ICO as a speculative tool, the company can raise millions of dollars in a few minutes.n
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Is there a balance between over-regulation and full liberalization?n
Before the ICO broke out, the company could only choose to seek investment from venture capitalists at an early stage. This leads to a system of checks and balances because the venture capitalists make the most of the company’s business model. VC participation also limits the way these companies use financing funds. The arrival of ICO gives the company a quicker and easier way to finance it.n
Unfortunately, any company with white papers and unformed business models can also raise large amounts of money through the ICO. So regulators are trying to break in before the loss of funds due to ICO fraud. Must find a balance, only high net worth of individual investors can invest in ICO. And ICO must meet the basic information disclosure requirements. Reasonable solutions must not kill the new ICO industry, while not causing too much damage to the retail.n

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