The development of the cryptocurrency market has led to the emergence of opportunities for any start-ups to quickly attract investors for their project and conduct their own ICO (Initial Coin Offerings), that is, to organize the process of issuing the company’s own crypto assets in order to raise funds. And despite the uniform standards of ICO, each project, as well as each token, can have a number of individual features. That is why it is important at the stage of preparation for the ICO to correctly draw up an offer agreement and correctly define the civil-legal form of the electronic contract in the format of click-wrap (interactive conditions on the site, the consent of which occurs by clicking the “conciliation” screen button)) and browse-wrap (interactive conditions on the site with which the user expresses consent in an explicit form, but does not put a tick in a separate window).
Despite the fact that the national law of most countries and international treaties does not provide to date independent provisions for the regulation of the procedure for conducting and participating in the ICO, many regulators have already begun to form new approaches based on existing legislation.
For example, in the United States, Canada and Singapore, the issuance of crypto assets under certain criteria may equate to the issuance of securities, with all the ensuing responsibilities and responsibilities. This has led to the formation of alternative approaches to crowdsale and attracting new investors for their projects.
Not any issue of the token within the TGE (Token Generation Event seems to be a more correct name for the general categorization of such activities) may be legal in countries where potential investors are located. In addition, despite the fact that ICO/TGE gives great freedom to the organizers of the project to attract investments in cyberspace to create blockchain projects, there are many “earthly” issues that need to be properly organized: to define the corporate management structure, to determine the bank and the order of withdrawal of funds to the fiat in the bank account to pay for the running costs and work of the team, to clean up and protect the intellectual rights to the product.
It should be taken into account that, for example, even if the ICO is not directed to the American market, and the company that owns the service is located in the EU or Asian countries, it can still be applied to FATCA (the law on tax reporting on foreign accounts), which obliges any companies, one way or another opening accounts to American citizens, to report to the U.S. tax authorities.
In addition, the Convention on Anti-Money Laundering and Terrorism Financing, which has been joined by almost all countries in the world, enforces a number of measures that oblige the collecting of customer information (Know Your Customer and Anti-money-laundering) tokens.
determined by the volume of services and the time required to provide them, in agreement with the Customer.
lump sum payment
royalties after the launch of the project.
It is possible to consider the option of paying royalties in the project tokens.