Singapore Exchange announces ICO requirements
In a much-anticipated move, Singapore Exchange (SGX) revealed expectations for the companies conducting Initial Coin Offerings (ICOs).
In a detailed release published on the exchange website and signed by the SGX CEO Tan Boon Gin, it’s stated that while the exchange officials are not giving investment advice on whether one should invest in an ICO, there is a set of rules SGX expects its listed companies to follow. Below are some of the informative points that should be included in a potential ICO documentation, as outlined by SGX:
1) The rationale and risks (including operational, cyber security, manipulation, legal and reputational ones) arising from the ICO;
2) The description of how the funds would be used, including key milestones;
3) Following of the KYC (Know Your Customer) as well as AML (Anti Money Laundering) policies;
4) The accounting and valuation processes behind the ICO;
5) The current use of funds to conduct the ICO;
6) The financial impact on the issuer as a result of the token issuance as well as any contingent settlement provisions;
7) Any impact on shareholders’ rights;
8) Any other relevant to the ICO information deemed by SGX as necessary.
The official regulatory guidelines on ICOs came just in time, shortly after Singapore has been recognized as one of the friendliest countries in regards to crypto. Just earlier this month, The Monetary Authority of Singapore (MAS) and Singapore Exchange (SGX) have announced a successful development of the Delivery versus Payment (DvP) mechanism for settlement of tokenized assets across various blockchain platforms.
According to SGX, effective and efficient regulations are always possible, as long as there’s regular communication between all stakeholders. With the rise and development of the cryptocurrency market, more stock exchanges will join Singapore in coming up with the clear and precise regulations for the emerging industry, experts say.