The excitement revolving around Initial Coin Offering (ICO) is that the access to fundraising is now democratized, anyone with internet access has the opportunity to finance startups and projects. While ICO is an innovative way to get support from retail investors, this type of fundraising activity very rarely satisfies regulatory concerns. Regulators and lead professionals are nervous as the majority of these retail investors do not fully understand where they are investing their money in to.
Crypto custody companies are growing to meet the needs of institutional investors, including hedge funds, who are patiently waiting to pounce on the digital currency. However, custody solution will vary depending on whether you are a retail grade consumer, a high net worth individual, an asset manager, a corporation or a recently minted project with a cryptocurrency in your treasury. While self-care is the preferred method for individuals, institutional money needs institutional level care, but the question remains, what is the best solution for crypto custodian service?
Initial coin offerings (ICOs) have raised over $20 bln this year, and are completely changing the way startups gain access to capital, especially for those in the early stage. In the ICO process, startups issue their own digital tokens and exchange them with by contributors worldwide for other cryptocurrencies like Ethereum or Bitcoin. Tokens are accordingly classified by their use cases and functions, the most common of which dichotomizes them into utility or security tokens.
The Gibraltar Financial Services Commission (GFSC) has taken a substantial first step in providing regulatory clarity and support for the blockchain and cryptocurrency industries. Beginning January 1st, 2018, the GFSC has required that businesses using distributed ledger technologies (DLT) obtain a license to be authorized as a provider of such services.