Raising capital from VCs or institutions can be a costly and difficult process so ICOs have risen in popularity as a way of confronting this reality. Funds are contributed by ICO legal backers in the form of fiat or cryptocurrencies in exchange for tokens that are created by the issuing company. In most cases, these tokens are needed to use the company in questions service. The token sale (coin offering) can accurately be interpreted as an advance sale of the service. The company that has sold these tokens then uses the funds from the sale to develop the final end product from the original concept stage. Investors, in turn, hope that when the final product is released it will cause a demand for the tokens they are holding and will increase the value of their investment.
The best marketing tool is the white paper and its clarity and standard will have a direct effect on how many contributors will pursue your ICO. Our team can create a white paper that is concise, clear, and that contains all of the necessary legal and technical information. Reach your target audience whatever language they speak with the full translation service we offer. The first step in launching a token sale is publishing a white paper that clearly lays out the roadmap, functionality, target market and vision for the product by its founder. Other important details include the ICO structure, the tokenisation model, token distribution rations, funding options, lock-up periods, among other things.
The level of detail is very important and this is certainly the case with the ICO market. The fine print is there to protect you and your contributors through the token agreement, terms of use, and the privacy policy. We have built a trusted network of legal professionals who specialise in ICOs who can produce clear and firm documentation to guide your ICO through any complex legal scenarios.
Building and retaining customer trust requires extensive documentation and the liquidation and distribution process can be extremely complicated. Our ICO legal professionals can help guide you through the process of token distribution and fund liquidation making sure all local regulations are complied with, ensuring contributor trust.
When the ICO has gone live, backers of the project generally continue to contribute in exchange for more tokens. An ICO can be viewed as an informal IPO but one in which start-up companies are able to raise funds at less cost than using a typical VC funding model. It is also a way of cutting banks and regulators out of the transaction to a certain extent while making VC accessible to a wider audience.
We help our clients avoid the potential exposure for founders in the future by covering all aspects of legal and taxation in detail. Our legal team will thoroughly review your ICO to ensure that it complies in full with the ICO regulations of Malta.
Founders need to be aware that some pitfalls remain in carrying out their ICO despite Malta having regulations that are rational and practical. There is some truth to the idea that issuing utility tokens is less complicated than security tokens, however, the time and investment requirements are outweighed by the additional investment and advantages they illicit from institutional investors. There are several ICO legal elements that need to be considered despite the common tokenomic model not compromising voting or profit instruments. A white paper that is well defined and clear, that is compliant with the Maltese VFA act, combined with a sound token sale agreement is crucial and needs to cover:
Our legal teams will use this ICO legal framework to create a collection of ICO legal documents (white paper review, token sale agreement, data protection compliance, privacy policy, legal opinion) to ensure that founders are not legally exposed.
Tax implications, specifically how to minimise tax obligations while still keeping the ICO legal, is a key concern for every founder. Another concern is how to protect the token buyers as fully as possible. Our ICO legal advisors are able to reduce an ICO tax bill down to around 5% by creating a legal structure that has been tested against all possible scenarios.
The Maltese government has embraced blockchain technology with an early commitment which has made it the ICO jurisdiction par excellence. This means foreigners that launch their ICOs in Malta can enjoy a personal tax rate of 5% and some token sale models enjoy a rate as low as 0%. The Maltese population speak English as a native language, are tech savvy and are highly educated. Malta is a member of the EU and has a long history working with multinational industries via the huge finance and online gambling industries based on the island.
Raise capital for your venture by registering an ICO. Let us guide you through the entire process from assessing your tokenomic model, creating smart contracts, legal document requirements, marketing and tax planning.
Let us guide you through launching your STO and help you getting started with issuing security tokens backed by a real world assets. Digitize your business by using the blockchain to raise capital for your business.
A cryptocurrency exchange has the toughest requirements from the VFA services regulated in Malta. When holding clients money, VFA’s and cryptographic keys the regulation takes great care of protecting users. Let us guide you through the complete registration of registering your cryptocurrency exchange.
The VFA agent is central in conducting crypto and blockchain related business in Malta. The agent is the bridge between your business and the authorities. Our experience as VFA agent will guide you through the fit and proper tests, financial instruments tests and ensure your business remains compliant.
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