While many countries voice their concerns on ICOs and consequently talk of formalising regulation for token sales, the tiny Baltic nation of Estonia is welcoming them with open arms.
Kaspar Korjus, the head of Estonia’s innovative e-Residency program has just announced “we’re working to make e-Residency the best option globally for entrepreneurs launching a trusted ICO.”
Estonia Offers “Clear Regulatory Framework”
The original e-Residency program, launched in 2014, allows anyone of any nationality to become an electronic resident of Estonia. A pioneering concept, Estonia’s e-Residency framework allows for the formal registration of companies, bank accounts and accommodation of taxes, all done remotely.
Now, however, they’re planning to expand on the concept of e-Residency to incorporate another service: coin offerings.
Korjus states that the current lack of regulatory clarity means that, “ICOs continue to operate in what could be described as legal grey areas” and that the “lack of clarity and trust is holding back the benefits of this innovation in finance.”
By offering a clear regulatory framework, he is hoping that e-Residency will offer a way for companies to raise funding with more assurance on all sides. ICOs run through the program would be subject to best practices guidelines, giving their investors more confidence and transparency.
Kojus also gave an update on the development of the “estcoin” project, Estonia’s own token offering. When the idea was first announced in the summer, the European Central Bank quickly moved to announce that no eurozone country could issue its own cryptocurrency to compete with the euro.
As a result, there is now some debate about how estcoin might proceed. One proposition is to peg estcoins to secure digital identities. Such a move would make it easier for ICOs to stay on track of Know Your Customer regulations while minimising the chance an investor would lose track of their tokens as they would be tied to his or her digital identity.
The small Baltic nation is already well-known for its innovations in public services and friendly attitude to business. Corporation tax is 0% on undistributed profits – formally listed as “harmful tax practice” by the OECD – and income tax a flat 20%.
Kojus hopes that the program might provide a space where his nation, international investors and ICOs all benefit.
“Crypto tokenisation will alter the nature of our world whether we act or not” he said, adding that they would continue in their “objective to grow our new digital nation and democratize access to entrepreneurship globally.”