"The guidelines also define the information that FINMA requires to handle such queries and the principles on which it will base its responses," were the words with which a press release from the agency began, "creating clarity for market participants." . 

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ICOs have harassed regulators around the world since its inception in the summer of 2013 as a creative form of crowdfunding. They deliberately reflect the initial public offerings (IPO), which are used in a famous way to bring traditional companies to the market.

However, the IPOs have taken all the traps that come with success: entry barriers make them a very expensive proposal, which requires gaggles of lawyers and regulatory leaps. The ICOs, due to their adverse situation, have avoided all this for a sum of 6,000 million USD in 2017 alone.

"FINMA has seen a strong increase in the number of initial offers of currencies (ICO) planned or executed in Switzerland and a corresponding increase in the number of inquiries about the applicability of the regulation," insists the regulator. Following his Spring Orientation document last year, "explaining how he intends to deal with the consultations of ICO organizers", FINMA wishes to consolidate "transparency at this time" since "it is important given the dynamic market and the high level of demand".

ICOs are a participatory token economy in the literal and digital sense. In general, they focus on a specific project, and the combinations and permutations of this idea are as broad as the large number of ICOs: ownership of a company, payments, negotiable currencies, some of which are expected to go beyond Be a certificate of digital actions.

They are a risky investment and, as these pages are well documented, the skillfully written white papers and the landing pages of the websites have often represented little more than scams.

Not all ICOs are the same

A large majority of ICOs rely on the Ethereum platform and their Request for Comments (ERC20), which is used for intelligent contracts. More than twenty-one thousand contracts of this type exist, and estimates hold that ERC20 has a large majority of ICO market share.

The Swiss guidelines "are not applicable to all ICOs. Depending on the way the ICOs are designed, they can not be subject to regulatory requirements.

Circumstances must be considered on a case-by-case basis. Currently, there is no specific ICO regulation, nor is there relevant jurisprudence or consistent legal doctrine.

As such, FINMA will focus on the economic function and purpose of the tokens (that is, the blockchain-based units) issued by the ICO organizer. The key factors are the underlying purpose of the tokens and whether they are already interchangeable or transferable.

The Swiss guidelines subdivide the tokens into three classes: payment, utility and assets. The payment tokens are basically cryptocurrencies since most of them understand them; utility tokens are access to services; Asset tokens work more like derivatives, bonds, stocks, and can serve as interest or dividend payments.

FINMA's deepest concern involves the subversion of the law against money laundering (AML). "The FINMA analysis indicates that money laundering and securities regulation are the most relevant for ICOs", and as such they contain "requirements for financial intermediaries that include, for example, the need to establish the identity of the beneficiaries "

Revealingly, the agency states, "Money laundering risks are especially high in a decentralized system based on blockchain, in which assets can be transferred anonymously and without regulated intermediaries."

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Source: news.bitcoin.com