5 Best Countries to Launch Security Token Offering (and Their Regulations)

Though in their infancy, Security Token Offerings are fast becoming a reliable alternative to traditional crowdfunding resources. As a result, an increasing number of businesses and startups now prefer to offer security tokens over utility tokens or ICOs (Initial Coin Offerings).

So far, STOs are going strong with a success rate of 99%. In fact, companies such as Neluns raised a staggering $136 million through STOs, which is the highest amount till date, followed by Tzero gathering around $134.7 million.

However, the lack of legal frameworks is one of the problems still plaguing the STO market. Fortunately, different countries from across the globe have shown interest in revamping their existing laws and regulations to make it easier to issue, purchase, trade, and sell security tokens. Though such countries are only a handful, they are setting the tone to embrace the STO revolution.

Here is a list of the five most suitable countries for launching an STO.

Lithuania

Lithuania, one of the east European Baltic countries known for its Gothic, Renaissance and Baroque architecture is on its way to becoming a global STO hub. While leading economies such as China and Singapore are still working out the legal frameworks for ICOs and STOs, The Crowdfunding Law of the Republic of Lithuania has already become the first ever law to provide a legal basis to sell, purchase and trade security tokens.

The Lithuanian Ministry of Finance has already issued crystal clear regulations covering crucial aspects of STO and ICO such as taxation, accounting, issuance, and compliance. In Lithuania, you need to send your STO details to the supervisor of financial markets. They will get back to you with a firm reply on whether or not your STO fits into their legal framework.

Lithuania’s crypto-friendly regulations have attracted global STO players such as DESICO. The DESICO crowdfunding project, dubbed as the biggest fintech project in Lithuania, has introduced the first ever legal security token offering platform.

DESICO holds a brokerage license for the secondary trade of tokens along with an EU license for issuing electronic money (E.U. EMI). The latter allows the company to exchange cryptocurrency for fiat currency and also open international bank accounts (IBAN) for making payouts.