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Commentary - 13 July 2018

Jersey's balanced approach to ICO activity

A number of high quality ICO promoters desire to use a Jersey incorporated issuer because of Jersey’s reputation as a well-regulated and reputable jurisdiction. Such promoters will be interested to read the JFSC’s guidance note for ICO activity, released on 12 July 2018.

Hawksford’s existing policy on providing services to ICO issuers is very much focused on quality, and we welcome the emphasis placed on this within the guidance note from the JFSC. The circulation of these guidelines follows last month’s signing of a memorandum of understanding between Digital Jersey and Binance – one of the world’s largest cryptocurrency exchanges – which will see  Binance develop a compliance base and a cryptocurrency exchange in Jersey. 

In summary:

  • The JFSC’s guidance note on ICOs is comprehensive and makes clear that Jersey will work with ICO issuers who present a hallmark of quality. It is a balanced approach that aligns with Jersey’s commercial and positive support for global innovation and early adoption, whilst managing investor protection, AML/CFT risk and Jersey’s reputation as a well-regulated and robust International Finance Centre. 
  • ICOs will not be regulated but the issuer will be required to satisfy a number of criteria which include the incorporation of a Jersey company which must be administered and maintained through a trust and company service provider licensed by the JFSC such as Hawksford. Hawksford will also assist the issuer meet a number of other requirements, contained in this guidance note and via conditions placed on the issuer's COBO consent,  by appointing two directors to the Jersey boards.

David Carswell, Corporate Services Director at Hawksford commented, “Hawksford is a great supporter of innovation and a keen participant within the ICO and cryptocurrency space. We welcome the opportunity to develop services that quality clients require in this sector, from a regulatory, best practice and a commercial perspective. We are also supportive of cryptocurrency as an asset class within funds administration, a Hawksford service which has experienced significant growth in the last 12 months."

Read the latest guidance note on the JFSC website here (PDF)

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