With Blockchain came Bitcoin, which generated Ethereum, this brought some other important currencies, whether they bifurcate or are born as new in the space of cryptography. As this ecosystem has grown there has been a boom in the creation of more cryptocurrencies; the ICO boom. 

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As more and more companies use ICO as a fundraising tool and attract even more interest from individuals and investors, governments and regulators have begun to take action on the matter.

The problem is that these investment opportunities so far unregulated are created basically without guarantees for investors. They are mostly set as promises in a white paper to solve a particular problem with the power of Blockchain. However, holding them to those promises has not always worked.

For regulators and governments, these investment opportunities often have the hallmark of dangerous scams and are viewed with suspicion. This has led to a need for regulation and security for the people who invest in them.

The regulation of these ICOs has come mainly from governments around the world, but they have not followed anyone, in fact, the opinion divided between nations over the entire cryptocurrency space has seen a different approach to regulate them.

Because ICOs remain a new phenomenon for many regulators, the laws and rules on how to govern and regulate them are still being formulated and applied.

In fact, some governments have only recently made a public statement or warning about them. Some countries have been proactive and expressed their decision on ICOs, either positively or negatively.

Although there are also those who are still developing their regulations as they continue to learn more about the technology behind it, and what they really mean for their citizens.

Ready and regulated
Some countries have quickly caught up with the ICOs and have made decisions about how they will operate on the state border. There are those who have banned them completely and there are those who have established specific rules and laws to enforce them.

China

One of the most high profile regulations, and this time in a negative way regarding the ICOs was the way in which China handled these fundraising methods. Last year, the Chinese government proclaimed a general ban on them, which played an important role in lowering the price of Bitcoin and other cryptocurrencies.

The ban was implemented by the People's Bank of China and was aimed at all companies and individuals. It was so extreme that all those who had completed their funding cycles were ordered to return the funds.

South Korea

While there were rumors of a cryptocurrency ban in another major Asian center, South Koreans have officially banned ICOs. The Financial Services Commission of South Korea explained its decision saying that its objective was to protect investors from ICO's growing risk of fraud.

Russia

Russia is another country that has adopted a hard-line approach for both cryptocurrencies and ICOs. As regards its regulation of the latter, it is still not finalized, but there have been a series of orders established by the Kremlin.

These guidelines affect things like altcoins registration, taxes, as well as the application of securities laws. But the true regulatory laws are set for March of this year.

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Australia

As one of the first nations to institute true ICO regulations, Australia made sure they were covered to keep them online and protect their citizens. Australian regulators reacted at the end of September as their Australian Securities and Investments Commission set the rules.

The focus of Australians is to establish clear guidelines on how to operate within Australia's regulatory framework while encouraging innovation and the development of new financial business models. In short, it is a positive framework for ICOs, but it keeps them in line with the existing legislative framework in order to protect citizens against fraud or fraud.

Gibraltar

The small territory of the United Kingdom off the coast of Spain has become one of the last countries to develop its own ICO regulation. The Government of Gibraltar and its Financial Services Commission (GFSC) are developing their bill with the objective of regulating the promotion, sale and distribution of digital tokens.

One of the key concepts of this proposed regulation will be a new idea that will see the introduction of the concept of "authorized sponsors", which are supposed to be "responsible for ensuring compliance with disclosure rules and financial crimes."

Abu Dhabi (UAE)

The Emirate of Abu Dhabi also announced its plans for ICO regulations recently with the Financial Services Regulatory Authority (FSRA) willing to cooperate with relevant qualified institutions and people involved in the cryptocurrency industry.

The Abu Dhabi Global Market recognizes the global demand for digital currencies, stating that: "virtual currencies, although they are not legal tender, are gaining interest globally as a means of exchanging goods and services."

U.S

Due to the size of the US cryptocurrency market UU and the growth of ICOs in the country, there has been a need for more rapid and strict regulation by the government, and especially the SEC. However, just as there are different approaches in different countries, each state has different ways of handling ICOs.

However, the SEC, as a federal agency, maintains the opinion that these should be considered securities.

To this end, there is no general prohibition, but ICOs are expected to be registered and authorized by the SEC if they are going to sell these assumed securities. Recently, in a discussion in the Senate, the SEC hinted at even tougher regulations for ICOs.SEC Chairman Jay Clayton noted that every ICO chip that the SEC has seen so far is considered a security.

Adjustment under the current rules
Many nations have come forward and have at least recognized that ICOs are something that their regulatory bodies must examine. In addition, some of them have moved to keep their policies online while deciphering their approach. Because ICOs are unprecedented in terms of fundraising, governments have sought to appropriate existing regulations and laws.

Glen

Last year, in August, the Canadian Securities Administrators (CSA) issued a statement that the ICOs would be falling under the legislation that governs the securities, but they also demanded a categorization of such a token as a security element first. Basically, it was a call for those seeking to launch an ICO with the intention of executing it beyond the CSA before moving forward, allowing them to take it case by case.

"Any company that plans to raise capital through an ICO must consider whether it is a security. Companies should also contact their local securities regulatory authority, "he said.

Germany

Germany is another country that has not yet established a direct regulation of ICOs, but they expect any new Currency Offer to adhere to existing legislation, including the Banking Law, the Investment Law, the Securities Trade Act, the Law of Supervision of Payment Services and the Laws of the Prospectus. They have also come to realize that there are risks in ICOs.

"Due to the lack of legal requirements and transparency rules, consumers are left alone when it comes to verifying the identity, reputation and creditworthiness of the chip provider and understand and evaluate the investment that is offered.

Nor can it be guaranteed that personal data are protected in accordance with German standards, "the statement said.

Singapore

Seen as a great bastion of potential for ICOs and the cryptocurrency space in general, there have been a number of offers that have reached their safe haven, especially considering the position of China and others in the Far East.

His focus has been to provide guidance at this time, as they also develop their own posture. In November last year, the Monetary Authority of Singapore offered a guide on ICOs, which indicates how these currencies should be treated in accordance with the current securities laws.

The most recent word about ICOs in the country is that they will not be banned and that they do not feel that there is any risk. The MAS has been closely studying these developments and the potential risks they pose.

"From now on, there are no solid arguments to prohibit the cryptocurrency trade here," said the deputy prime minister.

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The European Union

Within the European Union, in general, the alignment of the ICO with the current legislation has been focused. The main process in dealing with them is to allow the ICOs to operate within the union, as long as they adhere to the Anti-Money Laundering / Know Your Customer (AML / KYC) policies.

However, like many of the nations in this category, the European Securities and Market Authority stated that they represent a high risk for investors.

Issuing a warning
There are not many countries that have not redesigned an 'approach with caution' response when asked about ICOs. In general, it is the first port of call for regulators who admit that they need to learn more about how ICOs work in their countries.

It is understandable that they expect ICOs to operate within the limits of their current legislation, and if they decide to categorize them as values, let's say they follow those regulations.

There are some countries that have been predominantly non-interventionist, in reality they only offer a warning or advice on how to handle these offers. This libertarian approach seems to be, for the most part, a starting point before regulation, in most cases.

Japan

Japan took one of the biggest steps to legitimize Bitcoin when it declared it a legal currency in 2016. However, as far as ICOs are concerned, Japan has not taken many important steps to control or regulate it. Japan has adopted a wait-and-see approach to the ICO market with its investor warning statement.

The Financial Services Agency also admitted that they are following international trends in this regulatory front to follow.

Malaysia

In September of last year, the Malaysian Securities Commission sent its own press release requesting investors to take over their warning when analyzing the ICOs. The Malaysian regulator also warned investors "to be aware of the potential risks involved in the ICO schemes."

Taiwan

In Taiwan, the chairman of the Financial Supervision Commission, Wellington Koo, issued a statement in October on ICO, Blockchain and Fintech, but instead of being a warning, it was a positive stance. Koo said the Taiwanese government intended to support the development and adoption of ICO, Blockchain technology and cryptocurrencies, and address them as legal.

United Kingdom

The United Kingdom allows the operation of ICOs, but expects them to adhere to existing financial laws and regulations. On top of that, there has also been a severe warning.

The Financial Conduct Authority warned that ICOs are unregulated and potentially fraudulent, since investors can receive "unbalanced, incomplete or misleading" documents from the issuer, the Financial Times reported.

Source: CoinTelegraph