Xiao Sa Team: It's 2024. Is it still possible to issue coins 'in compliance with regulations”?

Author: Xiao 飒lawyer
How to issue cryptocurrency (ICO) in a compliant manner has always been an issue that Web 3 Builders are most concerned about. After all, from the perspective of project initiation, governance, sustainable operation and generation of economic value Look, issuing coins is not a sickle that can only "cut leeks", but a tool that plays an important supporting role in the crypto ecosystem. However, due to the scars caused by the barbaric growth era of the currency circle a few years ago on investors, communities and even society as a whole, mainland my country still maintains a strictly restrictive stance on currency issuance. The "9.4 Announcement" issued in 2017 " and the 21st "Notice on Further Preventing and Dealing with Speculation Risks of Virtual Currency Transactions" (referred to as the "9.24 Notice") have always been a sharp sword hanging over the heads of practitioners in China's Web 3 industry.
But we have also seen that since 2021, the entire crypto asset market has gone through several rounds of reshuffle and reconstruction, the underlying technology of blockchain has made great progress, Web 3 projects have gradually begun to operate in compliance, and even traditional financial institutions have Through financial operations such as the issuance of cryptocurrency EFT, we have found a path to mutual benefit and symbiosis with crypto assets.
So, today Sister Sa’s team will chat with you. Is it still possible to issue coins in compliance with regulations in today’s Web 3 industry? What should I pay attention to if I want to issue coins?
Can we still issue coins in 2024? Let me start with a simple conclusion: it is not feasible to issue coins in mainland my country. When issuing coins overseas, you need to carefully choose the jurisdiction. Currently, there is a large criminal risk in issuing currency in our country. According to Article 1, Paragraph 2 of the 9.24 Notice: "Virtual currency-related business activities are illegal financial activities. Carry out legal currency and virtual currency exchange business, and exchange business between virtual currencies." , acting as a central counterparty to buy and sell virtual currencies, providing information intermediaries and pricing services for virtual currency transactions, token issuance financing, and virtual currency derivatives transactions and other virtual currency-related business activities are suspected of illegal sales of token tickets, unauthorized public issuance of securities, illegal Illegal financial activities such as futures business and illegal fund-raising are strictly prohibited and will be resolutely banned in accordance with the law. Those who carry out relevant illegal financial activities will be investigated for criminal liability in accordance with the law. "Under the clear characterization of the 9.24 Notice, we can basically judge that general projects. The behavior of issuing coins (i.e. the first issuance of project tokens to raise legal tender, general cryptocurrencies such as Bitcoin and Ethereum, and other valuable assets) is an illegal financial activity in mainland my country. Sajie's team believes that in the absence of clear legal provisions or normative documents for the "opening" of currency issuance, no one is allowed to issue currency or issue currency in disguise in mainland my country, otherwise there will be a greater risk of criminal offenses. Overseas, in countries or jurisdictions that have not passed legislation or other normative documents to prohibit the issuance of coins, it is theoretically possible to issue coins. However, everyone needs to note that today is different from the past. Today is no longer an era where crypto assets can grow wildly. Even in countries or jurisdictions that allow currency issuance, they need to be licensed while meeting a series of compliance requirements. Below, the Sajie team will share with you some general compliance points for overseas currency issuance based on the practical experience accumulated from serving customers in various projects. Summary of key points for universal compliance of overseas currency issuance (1) Distribution is both the narrative core of crypto assets and the consensus of the community, creating space for compliance. Sister Sa’s team is in the process of providing compliance services for overseas projects of multiple clients. , one of the most intuitive feelings generated is: Distribution is the essential feature, narrative core and community consensus of crypto assets and even blockchain technology. For a well-distributed project, the assets have higher transparency and non-tamperability, which increases the trust of investors. It can not only achieve long-term development, but also create a compliant survival space for itself and withstand supervision. Institutional review. At present, the world's major economically active jurisdictions mainly regulate crypto-assets by defining them as "securities" and defining currency issuance entities as "entities that issue financial products without registration." Today we will use the typical success of distributed Let’s look at the case of Uniswap to see the compliance space created by the distributed architecture for currency issuance. Uniswap Labs, the main operating team of Uniswap, first defined itself as a DAO and provided services to users by creating the Uniswap Protocol. The open source code of Uniswap Protocol allows users to conduct open market transactions while self-custody of their property. In 2023, the U.S. Southern District Court of New York ruled In the class action lawsuit of Nessa Risley Vs. Uniswap, the judge made it clear that "the transactions on Uniswap are not applicable to securities laws." This is mainly because it does not meet the relevant elements of the Howey test, and it cannot be concluded that it is subject to securities-related legal constraints. conclusion. The U.S. Howey test originated from the famous SEC v. W.J. Howey Co. case. The court clarified four requirements for judging whether a product is a "security" through precedents: (1) Whether it is money (money) Investment; (2) Whether the investment is expected to generate profits; (3) The investment is for a specific enterprise (common enterprise); (4) The generation of profits comes from the efforts of the issuer or a third party rather than the purchaser myself.

The above is the detailed content of Xiao Sa Team: It's 2024. Is it still possible to issue coins 'in compliance with regulations”?. For more information, please follow other related articles on the PHP Chinese website!