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Regulation

CNMV confirms no ICOs authorized in Spain

Maya Mandz | Mar. 29, 2019
CNMV confirms no ICOs authorized in Spain

March 29, 2019, | AtoZ Markets - The local financial authorities have recently stated, that there are no ICO’s authorized in Spain yet. The Spanish regulators made their statement to quell rumors about the current regulatory status of the digital assets in the country.

Spanish regulator leaves some hope to the local ICO’s project

The Spanish National Securities Market Commission stated that, although there are no ICOs authorized in Spain, they had not yet exercised their authority to inspect or regulate the sector. As part of the statement, the regulator outlined that the official documents of the ICO's should contain a frank disclosure of this fact, confirming to investors that the supervision of projects is not controlled by the regulator. The Spanish financial watchdog also stressed that the technical documents should confirm that the projects of the ICO "have not been subjected to any verification by the CNMV or any other administrative body."

ICO regulations in Spain in a brief

The CNMV published its statement on March 26 stating that it has not approved yet and checked any organization in the ICO industry to undergo ICO. It is worth noting that the local regulator has contacted the ICO investors asking them to include in their draft disclaimers that they did not approve or did not subject any project to verification. In accordance with the Spanish regulator's statement, any ICO project that does otherwise is unacceptable, unless it is reviewed and approved by the regulatory body prior to the start of the project. Subsequently, CNMV also stressed that it is limited to confirming whether tokens can be securities and that the sale of digital assets below a certain limit does not require their approval.

CNMV activity in a brief

Along with the legislative activity, the Spanish regulatory body involved in the supervision of the local market and related activities. Earlier this year, the financial authority added several cryptocurrency exchanges to its list of warnings, along with several forex exchanges, which are considered to pose a risk to potential investors. Previously, several reports indicated that CNMV included only 23 unapproved forex and crypto objects in its marked list. 

The ICO statement, although was welcomed as one more step to clarify the position of the regulatory body on issues related to high-risk tokens. 

Digital assets are still considered a risky business

ICO is regarded by the experts as a very risky activity for investors, as today the vast majority of token releases lead to losses for early investors. Lack of investor awareness, coupled with ambiguous and often outdated regulation, means that the sector continues to disappoint investors lured by the promise of quick profits. The regulatory body’s steps to disclose information about high-risk investment products such as digital assets are designed to even out the position from the point of view of the ICO. According to the local regulator, the minimum investment amount into ICO project for each investor should be up to 100,000 euros. CNMV stated:

“This, logically, is independent of the fact that the participation of an investment services company may be necessary, in accordance with the provisions of article 35.3 of the LMV [Spanish Securities Market Act] and in the terms set out in the criteria published by the CNMV in this regard.”

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