While controversial, the rise of initial coin offerings (ICOs) could be a signpost that industrial-age ways of raising capital will give way to thisnew model. As a decentralized, democratized investment and consumer-oriented business model, ICO has rapidly expanded across borders.
but,
but,The United States does not join the ranks of these countries.While U.S. regulators have publicly stated that they want to be friendly to innovation in the field of encryption technology and promote domestic entrepreneurship, the reality is thatThe United States began to crack down on ICOs.
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asCoinDeskEmphasize that the foreseeable result is thatsecondary title
Race to the bottom or value competition?
Clearly, entrepreneurs and companies will choose jurisdictions that are more attractive: they will be allowed to raise capital from investors, serve customers around the world quickly, safely, efficiently and with minimal commercial friction.
To meet this demand, places like Gibraltar, Switzerland, Liechtenstein, Malta and Bermuda have welcomed token sales and created local regulations that balance the goals of industrial development and consumer protection.
One might question the reputation of some of the countries embracing ICOs and jump to the conclusion immediately:“race to the bottom“It’s happening that regulators are sanctioning even the most impractical ICOs for the sake of taxes and headlines without any questioning.
However, according to blockchain startup Sweetbridge,A race to the bottom didnt happen.The company has held discussions with regulators from around the world, including representatives of many G20 countries. Although it is not ruled out that some people will take advantage of this jurisdictional arbitrage, ICO projects in the true sense will not be willing to land in such a country.
Sweetbridge says what they see is not a race to the bottom, butA race for quality.Quality ICO projects will flock to places that offer the best overall value proposition: the best legal expertise, the best balance of regulatory control and freedom to innovate, the best technologists and the best branding—even if they can be found elsewhere Get cheaper (and possibly worse) service.
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follow the leader
Countries large and small are beginning to heed the message.
Many countries are struggling to figure out the best way to master this new business model, while at the same time rethinking outdated ways of raising capital—especially the idea that token offerings are necessarily investment contracts.
They see new opportunities:Breathing fresh life into local economies and potentially destabilizing the global balance of financial power.
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UKs chance?
Sweetbridge notes that the sleeping giant in this conversation is the UK.
The British have long been eager to wrest back the title of the worlds premier financial center from the United States and re-crowd the City of London, and there is a growing view within the government thatBlockchain and financial technology could be a stepping stone to make this happen.
The U.S. lacks the drive to push for change, while the U.K. is seeking post-Brexit change. As a result, the always conservative Britain began to embrace new ideas. For example, the UK’s Financial Conduct Authority recently launched a Fintech Regulatory Sandbox to allow challengers and innovators to issue tokens without incurring high compliance costs.
The British also understand that if they fail to seize the opportunity of economic transformation, the consequences will be disastrous.
Although the United Kingdom gave birth to the Industrial Revolution, the land social structure of the British colonial period made them too comfortable. In the end, because they could not adapt to the changes quickly, they handed over the dominance of the industrial age to the United States.
In addition, the legal structure of the Commonwealth is relatively friendly to new methods of capital raising. It tends to take a buyer beware approach to such products rather than a paternalistic approach like the US, ensuring that only the rich get good investment deals (unless that deal happens to be offered by a government sponsored lottery ).
Of course, not all innovative cryptocurrency projects will flee the US. But in recent months, it has become clear thatIn the coming era of decentralized business models and global capital raising, the United States cannot dominate the world because of regulatory issues.
