Lithuana's central bank has become the latest financial institution of its kind of release new guidance for those seeking to organize an initial coin offering (ICO) in the country.
The four-page position note features two sections: one that largely reiterates a 2014 statement effectively banning banks and financial institutions from handling or otherwise working with cryptocurrencies, and another that hones in on the issue of ICOs. It comes on the heels of similar statements from other central banks regarding the legal ramifications of such offerings.
On the question of ICOs, or the sales of cryptographic tokens commonly used to bootstrap a new blockchain network, the central bank outlined a number of national laws that could apply – depending on the characteristics of the project and the function of the token itself.
Marius Jurgilas, one of the central bank's board members, said in a statement:
"Notwithstanding the fact that such activities are not regulated, in their essence, they are the raising of funds from investors, often unprofessional, to finance some activity. Since the risk of losing investors' funds and other risks are particularly high, our position is that such offering, in certain cases, should be subject to investment related legislative requirements and restrictions."
The central bank said that Lithuania's laws regarding securities, crowdfunding, collective investment schemes and the offering of financial services more broadly could impact the blockchain use case, per the text of the position note.
At the same time, the institution clarified that there is no specific piece of regulation regarding ICOs – a factor that both organizers and investors should bear in mind when moving ahead with any launch plans.
"It should be noted that, when deciding on the application and scope of specific legislation of the Republic of Lithuania for specific ICO, the conditions of the relevant ICO should be analysed and assessed," the document states.
Image via Shutterstock
The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at firstname.lastname@example.org.
LithuaniaCentral BankICOsToken Sales
National Chinese Science Academy Launches Blockchain Lab
China's federal science institution, the Chinese Academy of Sciences, is taking part in a new research effort around blockchain.
The highest academy for science in China said it had established a n
St Louis Fed Now Tracks Crypto Prices on Its Research Database
The St. Louis division of the U.S. Federal Reserve Bank is now tracking the prices of four cryptocurrencies in its research database.
According to an announcement on Tuesday, Federal Reserve Econom
Chinese Gov’t Rates EOS as the Best Public Blockchain, Bitcoin Drop to 17th
EOS tops the public blockchain among 30 projects in the cryptocurrency space, while bitcoin, the original and largest cryptocurrency, is ranked 17th, according to the Chinese government’s second mon
Bloomberg Terminal Adds Huobi's Cryptocurrency Market Index
Cryptocurrency exchange Huobi announced that financial data firm Bloomberg has added the HB10 crypto market index on its terminal for subscribers.
In an announcement on Thursday, Huobi said users o
Skycoin’s Chinese Marketing Team Took CEO Hostage and Stole 18 Bitcoins
The blockchain project Skycoin, which touts itself as the “the new internet for the new world”, saw a major sell-off over the past two weeks after an insider trading and a series of scandals were
Winklevoss Brothers Score Another Crypto Investment Patent
Crypto exchange Gemini founders Tyler and Cameron Winklevoss have long sought the creation of a bitcoin exchange-traded fund.
And while that process remains in flux, a company tied to the brothers
Why bitcoin made a comeback after the South Korean exchange hack
Bitcoin made a comeback despite crashing after a recent hack on a South Korean exchange, and two cryptocurrency traders explained why it rebounded. Charlie Lee, the founder of Litecoin, a global
Trump Official Argues for 'Sweet Spot' in Crypto Regulation
The U.S. government needs to find the "sweet spot" in its oversight of the cryptocurrency ecosystem, Mick Mulvaney, acting director of the Consumer Financial Protection Bureau, said on Wednesday.