The procedure for initial coin offering in Italy
Technology has evolved so much in the last few years that it has become indispensable in most industries. One of the latest developments in the IT field is related to the financial industry and revolves around blockchain technology which is employed more and more by banks. Blockchain is so popular because it is very safe. So safe, in fact, that it allowed a bank to issue a large amount of money as a loan. Another aspect of blockchain is the possibility of creating new virtual money which can be traded. This process is called initial coin offering, or ICO, and has become very popular in most countries in the world.
ICOs have also gained popularity in Italy where startups use them to gather funds and finance their operations.
Those who plan to set up ICOs in Italy must follow a few specific steps before launching them. Let’s take a look at these steps below.
What is an ICO?
Simply put, an initial coin offering represents the means of raising money by offering investors new digital tokens, the key being the new virtual currency created for this purpose. Before being able to do that, the person or company issuing the virtual money, called the issuer, must follow a few steps and procedures: creating the virtual currency, registering a company in order to be able to issue it and marketing it.
Creating a new virtual currency
In order to launch an ICO in Italy, one will first need to create a new digital coin with the help of a computer and an open source platform where the code for the token will be created. This is rather technical; therefore, it will imply having some IT knowledge.
Registering a company
Once the virtual coin is created, the issuer must register a company with the Italian Trade Register. This process is simple and does not require any special considerations. It would be a good idea to register the digital token’s name as a trademark. This will help when the virtual currency is launched on the market and is recognized by investors.
Specific regulations for Italian ICOs
The next steps for launching an Italian ICO will imply carefulness, as the success of the operation will depend on them. So, the issuer will first need to market the new virtual coin to potential investors. In order to do that, he/she will issue a white paper or a short version of a prospectus and promote it on dedicated websites.
The white paper will explain how the purchase works and what the rights deriving from the purchase are. It should be noted that ICOs do not grant shareholding rights to investors buying digital tokens, but will only help the issuer raise money.
The issuer will issue the virtual money for a specific period of time during which those interested can subscribe and buy the recently issued token. The sale is based on a digital token contract which is released by the issuer and digitally signed by the subscriber.
Italy does not have a specific law regulating the issuance of ICOs, however, investors interested in this type of business can follow the regulations applied to investment funds and they will get pretty close to what this means.