The state of ICO regulation in the world


Back in 2010, it would have been practically impossible to buy a pizza or a soda with 5,000 Bitcoins. Well, times have really changed. Today, you can do a lot more than buy a pizza with your BTCs. Cryptocurrency started as an idea and over the years it has become a reality even for the most rigid of governments. In this digital coins list, you will learn of the where different governments and jurisdictions stand with respect to ICO regulation.

The growth of ICOs

One can say that 2017 was the year of ICOs given that an average of 20 ICOs used to be done weekly. 2018 seems to be the year of reckoning for cryptos and ICOs as tough regulations are sprouting from every corner. Governments are introducing bills to parliament, issuing warnings and at times completely banning some cryptocurrencies and ICOs. The good thing about all this is that governments are recognizing that blockchain technology is here to stay. Regulating cryptocurrency may mean that eventually, it might become some form of legal tender.

Regulations in different parts of the world

United States

The United States seems to be slowly accepting cryptocurrency. In December 2017, SEC came out to say that no ICO up to that time had been registered with it. In the following weeks, ICOs which were deemed mysterious and scammy were targeted by the government. In March 2018, SEC went further and issued subpoenas to 80 ICOs in a probe that the commission says might last up to one year. ICOs are expected to adhere to the strict AML/KYC regulations. Failure to adhere to these policies may expose an ICO to legal action or even seizure. .

SEC is yet to decide whether and how securities laws apply to cryptocurrency. On one hand, SEC says that digital coins are subject to regulations. It has not clarified how developers of such coins should comply with those regulations. Crypto firms normally have to rely on lawyers to help them navigate the somewhat murky legal system. In some instances, cryptocurrency firms are opting to ban American investors altogether from participating in ICOs in order to avoid getting on the wrong side of the law.

Good cryptocurrencies are finding their way into the good books of the American authorities though. In March 2018, Arizona regulators passed a Senate Bill 1901. The bill allows taxpayers to use a crypto verified by the Arizona Department of Revenue for tax purposes. Georgia, Vermont and Wyoming passed tax-related bills which are meant to enable taxpayers have an easier time declaring and paying their property and income taxes.


ICOs are allowed all over Europe. However, the firms issuing the ICOs must adhere to the Anti-Money Laundering and Know Your Customer (AML/KYC) policies. The firm is also required to follow regulations and policies and licenses that appertain to the business’ function. In November 2017, The European Securities and Market Authority (ESMA) declared that ICOs are generally risk to investors. The authority directed that firms dealing with ICOs meet all the relevant regulatory requirements set.

In February 2018, the Swiss Financial Market Supervisory Authority (FINMA) published a set of guidelines which were aimed at ICOs. According to FINMA CEO, Mark Branson, firms issuing ICOs cannot simply circumvent existing financial market laws. The creation of the regulations was necessitated by the rising number of ICOs done in Switzerland. A lack of clarity on whether ICOs should be regulated and a need for transparency also led to FINMA coming up with the guidelines. New regulations targeting ICOs are to be expected in countries such as the U.K.


In Japan, the Financial Services Agency is looking at regulations which may be introduced in order to strengthen AML/KYC with regard to ICOs. It is feared though that there might be a future crackdown of ICOs but as for now, the agency is issuing investor warning on ICOs. In China, ICOs were banned in late 2017. The central bank of the country ordered firms which had completed their ICOs to refund all money raised. China is one of the toughest countries on cryptocurrency and ICOs.

South Korea banned ICOs in September 2017. However, there are reports that South Korea officials are in talks with Japanese and Chinese counterparts to explore regulatory cooperation. This is seen by many as a move to ease the ban on ICOs.


There hasn’t been any government in Africa that has taken a stern step against ICOs or cryptocurrency. There have been some indications that the South African central bank has no intention of banning ICOs. In September 2017, a spokesperson for the South African central bank said that in South Africa, cryptos and ICOs are not guaranteed by the reserve bank and this means that no recourse or protection to customers is available.

You may also like


Leave a reply

Your email address will not be published. Required fields are marked *

More in Investing