What makes Blockchain different when it comes to financing

The blockchain ecosystem is current landscape is now focused on the several ways of fund-raising institutional wealth and, despite, regulation remains both an entrance and growth barrier for the blockchain industry.

Over the last 3 years, legal criteria has become more clear oriented towards a variety of topics, such as financial markets, taxation, GDPR, software, among others. Since August 2017, the U.S.
Security and Exchange Commission (SEC) began an effort to pursue regulatory compliance of those blockchain based startups seeking financing through Initial Coin Offering (ICOs) as general calls to market savings. This initiated a worldwide trend whereby different States began to rule on the legal treatment that they would give to (1) crypto currencies as a means of payment, (2) service providers of exchange, custody, wallets, brokers, investment funds, or any other type of financial operator, (3) issues and public sales of crypto assets (ICOs) and (4) on Smart contracts.

Within the European Union, both the European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) have appointed working group to study blockchain resulting in several reports, alerts and recommendations to investors and regulatory authorities of Member States; the latest of these issued by ESMA on January 2019, “Recommendations on ICOs and crypto assets”, identifies the legal gaps in the crypto-assets market, its risks and opportunities. In Spain, the Comisión Nacional de Mercado de Valores (CNMV) followed sush recomendations.

While this regulatory effort and know-how of the industry has been gradually increasing, the light begun to appear to the first Spanish projects that have launched crypto asset and blockchain based startups in ways that complies with current Spanish regulations, giving a sense of comfort to startups as well as encouraging new investors to join the blockchain ecosystem.

In these contexts, as more investors and entrepreneurs are being attracted to the blockchain ecosystem, it becomes more and more necessary to proclaim both the risks and opportunities of this market, as well as the mechanisms (depending on whether viewed from the point of view of a startup or an investor) to implement regulatory compliance in the development of the startup business model or to learn how to identify and prevent risk points.

At Across Legal, we have created a space for open knowledge and cooperative work in which to help the community in matters of implementation and regulatory compliance of blockchain-based projects as well as investors to identify investment opportunities through the process of due diligence.

Are you interested in knowing more?

Next June 27th will be held the 3rd Edition of the Workshop on financing for blockchain based projects at our offices in Palma de Mallorca. For more information contact mmorales@acrosslegal.com

Daniela Leal
Corporate lawyer