The explosion in popularity of initial coin offerings (ICOs) in 2017 took many by surprise, including financial authorities right across the world. Not many forecasted this happening and as a result these regulators have been scrambling ever since.
Throughout most of 2017 there was little to no proper regulation or oversight in the ICO sector. This has been changing gradually, with errant ICOs being shut down a lot quicker and more frequently as of late, with most governments having ICO regulations in the pipeline.
One of the countries that seems to nearly be set on releasing their on guidelines for ICOs is Lithuania.
It was on Friday that the Finance Ministry in Lithuania issued their wide-ranging guidelines for the operations of ICOs as they look to become a haven for these ICOs. This is a tactic a few other nations have been using in order to attract leading talent and startups in the space of blockchain.
They are one of the first nations in Europe to have given proper clarity on guidelines referring to ICOs and the issuance of tokens. The likes of Estonia and France have also been up there on the forefront of this movement.
The Lithuanian Ministry are hoping that the way they treat businesses holding ICOs will be an incentive for more projects and investors to be attracted to their shores.
Speaking about this issue, the Finance Minister Vilius Sapoka said: “We should make our efforts for Lithuania to become the main headquarters for those ICO project promoters which are willing to operate in a transparent and orderly legal environment.”
What do the guidelines offer?
They comprehensively cover key areas such as indirect taxation, corporate taxation, anti-money laundering and regulatory aspects for the operation of ICOs.
There are also detailed descriptions provided about what types of tokens will be considered to be securities and therefore will be subject to the legislation regarding instruments on the financial markets. This is a hot topic in the ICO world today, so it is certainly a key area of interest.
There are also details provided as to what sort of taxes funds raised via these token sales will be subject to. For a country with a population of less than 3 million people, they have already seen a lot of significant traction in ICOs operating on their shores, so they look forward to increasing this even further in the future.