STO/ICO Risk Assessment
As anyone involved in cryptocurrencies knows, there are always inherent risks with fundraising and promoting projects. Many of these risks involve required disclosures to investors, including issues related to legality and investor confidence. By connecting you with attorneys who can help you gauge the risk, you can diminish the likelihood of problems associated with fundraising not only in the United States but around the world. By consulting with our clients to ensure that they are compliant, we can keep you and your company out of harm’s way from the legal and regulatory pitfalls unique to ICOs.
Risk assessment and mitigation is a valuable tool when it comes to attracting investors and users to your cryptocurrency offering and platform. By establishing your commitment to due diligence, you are making an unequivocal proclamation that you are taking every step possible to safeguard your investors’ money. By having IBC on your team with our in-depth knowledge of cryptocurrency, blockchain and ICO developments, you will rest easy knowing that our team of experts can accurately assess any risk to your cryptocurrency projects.
At The IBC, we pride ourselves in our ability to provide our clients with the professional advice needed to help guide them successfully through the ICO process. Our deep understanding of cryptocurrency regulations will help guide for every step of your company’s growth and help ensure your success. We tailor our advice precisely towards the specific goals and needs of your company. This personalized approach guarantees that no matter what your needs may be, the IBC is here to help your company grow and flourish.
Points to Consider
There are crucial considerations than an ICO must consider prior to its launch. One of the threshold legal issues is whether a token or coin is likely to be considered a security. These seemingly straightforward questions can have extremely important long-term ramifications and cannot be taken lightly.
- Market Assessment
Has your company taken the time to analyze and assess the state of the market before fundraising begins? Failure to properly plan the timing of your fundraising round can have a profound impact on your ability to raise money, which can obviously be a severe impediment to your bottom line. Knowing what signs and indicators you need to be tracking prior to fundraising are keys to optimizing investor reaction and sparking interest in your particular project. Because we know what to look for when it comes to market instability, we can help you maximize your impact.
- Regulatory Risk Assessment Considerations
Of course, none of these factors mean much if your ICO becomes mired in regulatory purgatory right out of the gate. Risk assessment and mitigation isn’t just a recommended best practice- it’s an absolute necessity to avoid legal liability. The unintended consequences of failing to perform your due diligence can include violations of United States securities law, which can lead to your company not being able to operate within the United States. Losing access to the US market means keeping your Initial Coin Offering from not only a considerable portion of the cryptocurrency market but also from the investors and exposure that are so valuable in helping projects to grow.
- Mitigating Risk Associated with Jurisdictional Concerns
Securities laws in the United States are complex, and regulators can be unforgiving of even the most innocuous missteps. Because you will probably be subject to both state and federal laws dealing with the regulation, sale, and issuance of securities, the jurisdictional and procedural issues can be just as perilous as the substantive ones. And the stakes couldn’t be any higher- violations can lead to the loss of certain registration benefits, civil penalties, substantial fines, and even criminal liability including jail time.
- Keeping Our Finger on the Pulse of Cryptocurrency Law for You
Should you choose to structure your offering outside of the United States, there are additional issues you will need to address. Adherence to specific timelines will be essential to avoid the risk of criminal liability or registration exemption forfeiture. The experienced independent cryptocurrency lawyers who work with IBC can help guide your project through the choppy waters of international cryptocurrency regulation and international offerings to ensure that you have a successful and clean ICO.
Benefits of Risk Assessment
- Anticipating and Reacting to Future Issues
While many companies know securities law, only IBC has positioned itself at the forefront of cryptocurrency law and regulations by partnering with leading attorneys who can provide valuable insight. We not only understand the technology, but share our clients’ vision of the untapped potential of cryptocurrency projects. Our vision extends beyond your ICO and the immediate cryptocurrency community; we consider at how cryptocurrency projects like yours can change the world. With big thinking comes big rewards, but it also comes with the need to assess and manage risk at a level most companies have never encountered.
Our capacity to think big and see beyond the horizon allows us to help guide our clients not only through existing legal considerations relating to their ICO but also help prepare them for future issues. By taking this proactive approach, IBC can keep your company one step ahead of the competition.
- Protecting Your ICO From Violations
As leading cryptocurrency advisors, we take an all-encompassing approach to our representation. By bringing in top-notch lawyers to serve as general counsel before, during, and after your ICO/STO/IEO, we can help make sure that any potential risks can be resolved quickly and efficiently with essentially no risk to you or your company. We work with lawyers from top-tier law schools who are licensed in key jurisdictions including the United States, and are experts in the inherent risks associated with securities law, blockchain technologies, and regulatory issues.
- Inspiring Investor Confidence
So what exactly is our process for risk assessments? Our experts will evaluate your ICO, IEO, or STO to determine the probability of loss on your particular asset or investment. By assessing risk, we can help ascertain what steps you can take to not only mitigate risk but estimate specific upside rewards relative to your risk profile. By carefully analyzing these risk/reward ratios in conjunction with any legal or regulatory concerns, we can help you calculate the specific rate of return necessary to justify a particular investment.
By taking these factors into account, the IBC can help not merely identify risks but develop plans and contingencies to mitigate the risk to your investors. Providing your investors with such a global analysis will help spark investor participation and confidence based on your due diligence and foresight.