The National Council of Monaco adopted Law No. 1009, which defines the rules for the circulation of tokens with signs of securities. The initiator of the bill was Council member Frank Julien.
As stated in the document, it forms a “legal environment for organizing the placement of tokens. Tokens are a form of raising capital, which is carried out using digital records stored on a decentralized registry (blockchain). Using such a registry allows you to create tokens that will be sold on the market. ”
Thus, in Monaco, the issue of tokens (ICO / IEO) was put on a par with such a well-known procedure for raising funds in business projects as initial public offering of securities (IPO). This means that jurisdiction is emerging in the center of Europe, within which we can expect a boom in the issuance and placement of such digital assets. The law defines tokens allowed for launch as financial products that are very close in essence to securities. In the text of the document, tokens are described as digitized ordinary shares, and that is why in order to issue such financial instruments it will be necessary to register in Monaco as a public organization, that is, in the form of a joint stock company.
At the same time, the authorities of Monaco decided that the placement of tokens will be allowed only as part of a private subscription, that is, the issuer will need to select investors and compile a list of those individuals and legal entities that will purchase such tokens in advance. In addition, it was found that the minimum authorized capital of the token issuer in Monaco should be 150 thousand euros contributed by the usual monetary units of the eurozone.
Meanwhile, Tim Draper, a well-known American Bitcoin billionaire, believes that attracting financing through tokens (tokenization) has greater potential than an IPO. He explains this by the fact that the current financial regulation in the US and Europe makes it difficult for companies that work with blockchain and cryptocurrencies to enter this procedure:
“The conditions for entering an IPO are so financially expensive that they make this way of raising capital uninteresting for such a business.”