France’s Autorité des marchés financiers (AMF) has published a request for consultation today, demanding the opinions of partners on how to manage initial coin offerings (ICOs). The AMF also notes that ICOs poses high risks due to the current shortage of precise ordinances, amidst other causes.
The AMF states that the processes of ICOs are designed to finance technological projects at an early step of their development. Submitting to these processes needs a good perception of the character of these projects, the related technology and the forthcoming risks. This kind of fundraising is by its virtue is meant for tech geeks and the savy public. As the tokens circulated during these processes have varied features distinct to each process, it is necessary to understand the type of the issued token, what it signifies for the company that issues it and the pros and cons comes along with it.
As part of its formation, the AMF has carried out a primary in-depth study of ICO processes and their legal uses. From this they discovered that some of the ICOs could be subject to current legal provisions (rules realtred to public offerings of financial securities and management of optional investment funds, in particular).
Nevertheless, most of the problems would remain, in the present condition of the law, apart from any regulation that the AMF has at its control.
It is in this state of affairs that the AMF recognized three alternatives for overseeing ICOs:
- Promote a model to good practice on a regular basis;
- Stretch the scope of current laws to manage ICOs as offers of securities to the public; and
- Introduce new legislation adjusted to ICOs.
Donations to the consultation should be sent to the AMF by December 22, 2017,
ICO support program
The AMF also declared today the implementation of a program of support and research fundraising of digital assets named UNICORN (‘Universal Node to ICO Research & Network’), this program targets to give ICO projects a framework enabling the development of their processes and to guarantee the safety of investors willing to take part.
As an element of this program, the AMF will attract (French or foreign) entrepreneurs and their advisors from various kinds of projects, which will enable it to expand its legal expertise. The AMF also aims to promote academic research on this field and will issue a first impact analysis of these new methods of financing in one year.