World’s first ICO regulations will be introduced by Gibraltar in the following weeks, in response to the growing numbers of token sales.
Gibraltar’s government and Gibraltar Financial Services Commission (GFSC) have announced that in the coming weeks they will develop a draft law that will regulate Initial Coin Offerings (ICOs) in the British overseas territory, Reuters reported Feb. 9.
The draft law, aiming to regulate the promotion, sale and distribution of digital tokens on the territory of Gibraltar, will be the first ever set of regulations developed specifically for ICOs, the lawmakers claim.
One of the principal aspects of Gibraltar’s ICO regulations will be the introduction of the concept of “authorized sponsors,” who are supposed to be “responsible for assuring compliance with disclosure and financial crime rules,” said Sian Jones, one of GFSC’s senior advisors.
The draft law will also establish disclosure rules that will require ICO projects to provide “adequate, accurate and balanced information to anyone buying tokens”, the government and Financial Services Commission said to Reuters.
According to Reuters, over $3.7 bln was secured in ICO fundraisers worldwide in 2017, compared to $100 mln in 2016. This rapid expansion of the ICO market is what has reportedly provoked Gibraltarian regulators to take action.
In September 2017, Cointelegraph reported that with fast increasing numbers of ICOs, the GFSC issued an official statement, warning investors of the “highly risky and speculative” nature of ICO fundraising campaigns.