Are you thinking about executing a token sale (ICO/STO) in the EU?


What is the best EU jurisdiction for your blockchain/cryptocurrency company?


When launching a blockchain/cryptocurrency business, selecting an ‘’adequate’’ jurisdiction as your country of incorporation and, also, focusing on target markets for token issuance in favorable regulatory environments, can be crucial. Incorporation in a ‘’crypto friendly’’ jurisdiction will enable you to mitigate regulatory risks and, thereby, send a strong message to your potential investors, token purchasers and other stakeholders that you are ‘’doing everything by the book’’ and that you are here to stay. Evoking confidence is essential for your business and can have a great impact on your project, as incorporation in a regulated jurisdiction will give you additional credibility.

When it comes to developing ‘’crypto regulation frameworks’’, not all EU/EEA/European countries have taken the same approach. The impression that comes across when analyzing relevant jurisdictions is that most of them have taken a ‘’flexible and gradient’’ approach to regulating tokens sales and crypto-assets, meaning that no country that we mapped as relevant, appears to have imposed severe limitations such as outright bans for initial coin offerings and crypto assets. There is a strong correlation between crypto market tendencies and legal norms, one affects the other and that is why the regulation landscape has been changing with a fast pace recently. On the other hand, regulations have been affecting both the demand (token purchasers) and the supply (token issuers) side of the crypto market.

Taking that into consideration, we could broadly classify the following relevant jurisdictions into three categories:


  1.  Evident proactive approach (7 jurisdictions)

This category encompasses: Malta, Switzerland, Lithuania, Gibraltar, Jersey and Isle of Man. These countries have expressly legislated or introduced specifically developed methodologies, guidelines (criteria) for assessing how and to what extent crypto assets could be qualified as financial instruments, therefore falling within the scope of financial services regulation. France has just recently adopted The Business Growth and Transformation Action Plan (PACTE) in the National Assembly on the 15th of March 2019 which is an important step drawing this country closer to the digital revolution revolving around blockchain.

  1.  Careful consideration (15 jurisdictions)

This category encompasses: Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, Germany, Ireland, Luxembourg, Netherlands, Portugal, Spain, United Kingdom, Lichtenstein and Guernsey. It appears that the listed countries are taking a ‘’wait-and-see’’ approach, meaning that they do not specifically restrict or prohibit ICOs or crypto-assets, however, on a case-by-case basis they would take a guarded approach to related projects in full consideration of existing legislation within their jurisdiction and, where applicable, in the EU. Practically, lack of explicit and unambiguous legal norms and relevant guidelines in these jurisdictions does not mean that you would be able to bypass the regulation currently in force simply because of the manner in which such assets were created or offered (DLT/Cryptography).

  1.  Undefined approach (14 jurisdictions)

This category encompasses: Croatia, Czech Republic, Greece, Hungary, Italy, Latvia, Poland, Republic of Cyprus, Romania, Slovakia, Slovenia, Sweden, Norway and Iceland. Securities authorities in these countries don’t appear to have adopted legislation in this field. Moreover, clear guidelines and criteria as to their stance in these areas are lacking or not easily traceable at the moment. It may be ‘’easier’’ to launch a project from one of this jurisdictions, however, selecting a country with no ‘’crypto regulation’’ whatsoever to incorporate and operate in, could be considered as a ‘’red flag’’ from the investors/token purchasers perspective, thus, devaluing the project’s credibility.


So, what jurisdiction is best suited for your blockchain/cryptocurrency business?

Unfortunately, there is no universal answer to this question.

However, there are a few factors you would need to take into consideration while making this critical strategic decision for your company.

1.Crypto regulation

Obviously, you would want to incorporate in a crypto-friendly jurisdiction that has some kind of regulations, or guidelines set in place. Consequently, this may increase your operational costs to en extent and it may become impossible to operate without securing significant initial funding.

2.Specific ‘’industry regulation’’

In some cases there are specific regulatory requirements for your industry (i.e. if your project is based on lottery, raffle or gambling) it would be prudent to take into account relevant regulation in this field, as you may be obligated by law to acquire certain licence(s) in order to legally operate within that jurisdiction. Another example would be internet privacy regulation if you are looking to launch a project that includes usage of VPNs, since not all EU countries have taken the same regulatory stance in regards to  internet privacy.

3. ‘’General’’ regulatory compliance

You should keep in mind other aspects of legal compliance as well, such as: data protection and tax regulation, regulatory requirements regarding your incorporation etc.


What jurisdiction would you choose for your blockchain/cryptocurrency business?


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