We strongly believe that we need a European ICO/ITO manifesto, to create best practices in this exciting new innovation enabling projects to federate resources in a regulatory-free environment, ie in the existing legal frameworks, so entrepreneurs won't be intimated or stifled in developing innovation in Europe.
Ecosystem actors assisting projects and companies in the issuance of new tokens should take the lead in writing and educating ICO/ITO market, with a ‘Best Practices Charter.’ As of today, the ICO Charter is representing 19 countries around the globe.
This manifesto or Charter seeks to establish and build consensus the best practices for the launch of ICO/ITO’s : Questions addressed are do we need a KYC ? What kind of KYC? What type of token? Token structuration and uses? Defining the purpose of the ICO? What kind of due diligence must be made before the ICO/ITO? What minimum structure of whitepaper and prospectus? What information is provided in these ICO supporting documents?
1-INFORMATION PROVIDED BY THE ICO/ITO PROJECT
Detailed and exhaustive presentation of the ICO/ITO Project
Complete White Paper
Detailed information on the team, market, product and legal entity(ies) sponsoring the ICO/ITO project
Bylaws, articles of incorporation and shareholding structure
Provide information used to determine target Cryptocurrency raised
Roadmap for ICO/ITO Project
Bios and resumes of the key players/staff of the project doing an ICO/ITO.
Independent check of key players/Staff good standing (‘Fit and Proper’)
Independent check on the advisors’ suitability and independence.
2-INDEPENDENT LEGAL REVIEW OF THE ICO/ITO TOKEN AND ITS ISSUER
3-WHITE PAPER FEATURES
Underlying legal entity issuing tokens and its recent financials.
Brief description of ICO/ITO project.
Project ICO/ITO business Plan.
Amount of cryptocurrency sought.
Use of proceeds
Technical presentation of project
Token structure, mechanics, issuance (primary) and post ICO/ITO (secondary) features for the specific project ICO/ITO
Warning and disclaimers
Legal rules and competent court in the EEA (European Economic Area)
4-ICO/ITO SMART CONTRACT CODE AND TECH SPECS PROJET MANIFESTO V1
Smart Contract (s) or Access to code or any technical data detailing the Token delivery process, and subsequent impacts
5-KYC, ANTIMONEY LAUNDERING AND ANTI TERRORIST PROCESS
Passport, ID Card or any form of State issued ID document for physical person.
Articles of incorporation of a legal entity with authorized signatory officers
Tax-Residency of investor
6-TOKENS AND CRYPTOCURRENCY RAISING PROCESS
Disclosure of different types of ‘Wallets’, real time traceability of collected cryptocurrency (and/or Fiat currencies) for the ICO/ITO
Disclosure of fees in tokens paid to advisors
Pre-sales Mechanics/Rules and disclosure of rules to offer discounts
Traceability of all crypto transactions
Disclosure of all fees used for and during the process of the Pre-ICO/ITO and actual ICO/ITO
7-USE OF ICO/ITO PROCEEDS
Process of cryptocurrency proceeds ‘restitution in case the ICO/ITO target amount is not reached
Creation of an ICO/ITO Escrow wallet for cryptocurrencies
Rules and conditions for release of proceeds to the ICO/ITO project
8-ICO/ITO SAFETY AND SECURITY
Ongoing presence of an IT supervisor during the ICO/ITO to monitor the ICO/ITO web site, hacking and the correct Bugs
ISO 27001 certification recommended
9-ACCEPTANCE OF A THIRD PARTY AUDIT TO MEASURE THE RISK OF THE PROJECT
Disclose ICO/ITO process and history with outcome and results
Disclose market places where newly issued ICO/ITO token is traded
Sequence and means by which regular updates on the project are provided to the community
11-Commitment on the laws of listed States
ICOs complying with this Charter shall not:
Be carried out by an issuer incorporated under the laws of a State listed as “non compliant” in the latest version of the «Overall Rating Following Peer Reviews against the standard of EOIR » list published by the Global Forum on Transparency and Exchange of Information for Tax Purposes of the OECD, accessible at the following address: http://www.oecd.org/tax/transparency/exchange-of-information-on-request/ratings/ (a « Non Compliant State »); or
Be governed by the laws of a Non Compliant State.
If an ICO is carried out by an issuer incorporated under the laws of a State listed as “provisionnaly partially cooperative” or “partially cooperative” in the above-mentioned OECD list (a “Partially Cooperative State”), or governed by the laws of a Partially Cooperative State, the issuer shall expressly undertake, in the white paper, to answer in full transparency and cooperation to the tax information request submitted by foreign tax administrative, judicial or regulatory authorities