While other countries are banning or at least restricting Initial Coin Offerings (ICOs) as very risky, Japan in a rather swift move is going forward towards the legalization of them.
These guidelines have been presented by a government-backed study group, which examines the further adoption of ICOs, including rules for identifying investors, preventing money laundering, tracking the process of objects and safeguarding existing equity and debt holders.
These guidelines contradict the views shared by China and South Kora, which have entirely banned ICOs.
The so much drama about ICOs reflects the opinion of people that they are fraudulent scams. This is true for some of them, but not for all of them. The report says also that ICO issuers need to clearly explain how the raised funds, [profits and assets will be distributed among the owners of the tokens, equity, and debt.
“The ICO Business Research Group proposes the above principles as the minimum principles that should be satisfied at this time…To enable ICOs to be used safely by a wide range of issuers and investors and to be accepted well in the society, more detailed rules may be required.”
ICOs are particularly favorable among those who are seeking funding for their Blockchain startups. Since the beginning of 2018, ICOs alone has raised an $8.8 billion. However, they received also much of negative attention due to their unregulated nature, which means that there is little accountability. Many projects have turned sour, as their managers simply abandoned them or did not deliver on all of their promises.
This has not dented the views of this study group or in fact those who are willing to invest in the ICOs.