TRANSformation of ICO into CSF FINANCE SOLUTIONS
The Australian Securities & Investments Commission (ASIC) has just released new rules for ICO – clear and democratic ones
The Australian Securities & Investments Commission (ASIC) has just released new rules for ICO posing quite clear the framework for ICO, more precisely concerning the issuing of digital tokens. The type of tokens and purpose of its issuing is reviewed by ASIC in each specific ICO project. ASIC decide whether a case falls under the common law or corporation law (Corporations Act 2001) and its recent addition, the Corporations Amendment Crowd-sourced Funding (CSF) Act 2017.
ASIC seeks for answers to three questions:
- Could a token issued in an ICO be considered securities?
- Could a token be considered an interest in a Managed Investment Scheme?
- Could a token be considered derivatives or non-cash payment facilities?
If the answer to at least one of the three questions is affirmative, ICO is not allowed, but a new Finance Solution proposed to project initiator via CSF – equity-based crowd-sourced funding. Within this scheme the assets and an annual income of an issuing company should not exceed $ 25 million jointly, and it is possible to raise up to $ 5 million in any twelve-month period.