The regulatory hammer is coming down on token sales across the globe. The US, China, and Hong Kong are all tightening their grip on initial coin offerings and crowdfunding mechanisms, which opens an u
The regulatory hammer is coming down on token sales across the globe. The US, China, and Hong Kong are all tightening their grip on initial coin offerings and crowdfunding mechanisms, which opens an unexpected door for Britain.
Barry James, co-founder and CEO of the Crowdfunding Centre, sees a chance for the UK to build a framework that fosters innovation instead of stifling it. "Regulators across the world seem to be in a collective state of mortal panic about ICOs and crowdsales," James said ahead of an All-Party Parliamentary Group meeting at Parliament today. "While this is understandable given their naturally conservative natures it increases risk rather than reduces it. Not only that, it risks killing a truly golden goose which could otherwise benefit us all long into the future."
Excessive caution on regulation doesn't protect people. It pushes the technology elsewhere. James pointed to what blockchain makes possible. "The implications of blockchain technology are immense, and the applications are as exciting as they are diverse. Programmable, 'smart' money will be integral to our future lives, streamlining processes in every industry."
Token sales and ICOs provide what banks don't: a path for startups to raise capital without months of applications and compliance paperwork. "ICOs and token sales provide a way to fund the positive innovations we need, and businesses need an alternative source to the banks," James said.
Etch, a London-based blockchain startup, is launching an ICO to build an Ethereum platform for real-time employee payments in construction. The system cuts through the delays: employers pay workers instantly, workers avoid payday loans and overdrafts, and companies save money on payroll overhead. The platform unifies payroll and remittance services, benefiting employees while reducing the inefficiencies that cost employers time and money.
Euros Evans, Etch's co-founder, will join James at today's Parliament meeting to discuss how Britain can create the conditions where startups like Etch can grow. James made his vision clear: "This business would have been impossible without blockchain technology. By supporting firms like Etch, the UK can reduce its reliance on the huge, old-fashioned financial services firms and banks, with all the complexity costs and friction they bring."
The global regulatory picture tells the story. Last week, China's central bank banned ICOs and launched investigations into platforms that host them. Japan took a different path. Tech Bureau is building COMSA, a platform on the NEM blockchain that covers nearly all aspects of the ICO process. The startup raised US$15 million from JAFCO, Japan's largest VC firm, to fund the effort.
The UK faces a choice: regulate token sales into irrelevance or establish guardrails that let the technology develop. James and other blockchain advocates are pushing for the second approach.
Etch is an advertiser on MiningPool, but did not sponsor this story.
