New Zealand’s FMA: all tokens are securities

New Zealand’s Financial Markets Authority publishes commentary ICOs and cryptocurrency services 
27 October 2017   1113

New Zealand’s Financial Markets Authority publishes guidance on ICOs and cryptocurrency services, as the FMA wants to "facilitate responsible innovation, and ensure that the regulatory regime remains relevant and agile". 

Initial coin offerings 

The extent to which an ICO is regulated depends on whether a "financial product" is being offered to retail investors in New Zealand. The Financial Markets Conduct Act 2013 sets out four types of financial product:

  • debt securities
  • equity securities
  • managed investment products
  • derivatives.

The FMA further explains each type of the product in detail. What's important, it has been clearly stated that all tokens are to be considered securities.

All tokens or cryptocurrencies are securities under the FMC Act – even those that are not financial products. A security is any arrangement or facility that has, or is intended to have, the effect of a person making an investment or managing a financial risk. If appropriate, we can designate any security to be a particular financial product based on its economic substance.
 

The FMA guidance

The guidance also highlights that crowdfunding in the form of an ICO is not the same as crowdfunding covered by the FMC Act. The FMA licenses crowdfunding platforms to provide an intermediary service via a facility, such as a website, where companies make offers to retail investors. Crowdfunding under the FMC Act enables companies to raise up to $2 million in any 12-month period, without registering a PDS.

It is stressed that the ideas regarding the possible regulation of ICOs and token offerings include creating a new category of prescribed intermediary service similar to the equity crowdfunding model. This would require law reform and that can take a long time. 

Cryptocurrency services

Tokens and cryptocurrencies that are not financial products or services must comply with the Fair Trading Act 1986 to the extent that they are “in trade.” Notably, the Fair Trading Act also applies to tokens and cryptocurrencies that are offered in New Zealand but based overseas.

The FMA points out that the FMC Act does not cover crowdfunding via ICOs, and encouraged stakeholders to engage in conversation with the regulator “early in the development phase if you’re considering making an offer.”

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Gnosis to Hold Technical Meetup in London

The event headlined "How to build decentralized prediction markets?", organized by Gnosis and The Blockchain Connector, will be held in London, UK, on February 22, 2018
22 February 2018   122

Gnosis aims to build revolutionary market-driven forecasting technology to let users shape the future. It is built on Ethereum, a next generation blockchain protocol enabling advanced smart contracts. 

The event headlined "How to build decentralized prediction markets?", being a collaboration of Gnosis, The Blockchain Connector and King’s College London Blockchain Society, will be held in London, UK, on February 22, 2018.

Gnosis blockchain conference in LondonGnosis Technical Meetup in London Announcement

Location: King's College London, Room BH (S) -1.01, Bush House Auditorium, Ground Floor, 30 Aldwych, London, WC2B 4BG
Date and time: 6:00 PM – 9:00 PM GMT, February 22, 2018

The presentation will cover technical details of the Gnosis platform and how developers can get started building their own application on Gnosis. Moreover, future technical challenges to bring Gnosis to the masses will be discussed and possible solutions will be presented.

The headline speaker is Stefan George, Gnosis CTO, who wrote the crowdfunding campaigns for Gnosis and SingularDTV and the multisig-wallet which became a standard for ICOs today.

The event is held for software engineers, software architects and computer science/software engineering students only, and everyone who wants to participate is required to register beforehead.