Contemplating an initial coin offering? Digging for some ICO legal tips? Well then, you’ve landed in the right place! Because for you, we’ve put together a checklist of legal considerations for initial coin offerings.
If you still have questions after reading, get in touch. We’d love to chat and lend a legal hand with any ICO business matters.
ICO Lawyer Tips: Business Formation
Establishing a proper business structure is step one. The wrong choice can lead to profit-sucking problems. And remember: If things go south, without a corporate shell, investors can more easily hold you personally and materially responsible.
First determine what classification works best for your size, scope, and profit plan. Enlisting startup lawyers at this initial step is wise. They’ll be able to assess your plan and craft an ideal business structure with the potential to yield maximum profits while shielding personal assets from the long, greedy arm of Uncle Sam.
ICO Lawyer Tips: Jurisdiction
Choosing an incorporation jurisdiction is another crucial decision. The right locale can make all the difference. When it comes to initial coin offerings and other fintech startups, sometimes overseas options make supreme sense for favorable tax and regulatory treatment. Overseas, some ICOs are subject to less intense standards than they are in the US. And no, moving your entire operation isn’t necessary — and for some ICOs it doesn’t make any sense!
To learn more about offshore ICO jurisdictional options, get in touch (link). Our team regularly works with startups and token investors on international positioning. We’ll review your plan and present several bespoke options for your exact situation.
ICO Lawyer Tips: SEC and State Checks
Federal regulations don’t specifically target businesses just because they’re involved in crypto…yet. But that doesn’t mean digital currencies are 100% unregulated.
Many altcoins and ICOs qualify as securities and are subject to regulations and reporting requirements. Moreover, several states — like New York with its infamous bit license — also have jurisdictional requirements; failure to comply can lead to crushing fines and professional suspensions.
Our ICO legal team works with entrepreneurs and startups on international, federal, and state finance compliance. We’ll make sure your venture is operating on the right side of the law while remaining as potentially profitable as possible.
ICO Lawyer Tips: IRS Positioning
Yes, you must calculate cryptocurrency gains and losses into your tax formula. The IRS has provided some guidance on the matter, but a lawyer with both tech and tax experience is best positioned to make sure you’re paying the least amount possible while remaining compliant.
ICO Lawyer Tips: Anti-Money Laundering
In the interest of national security, authorities developed anti-money laundering (AML) regulations. Primarily, these measures involve collecting investor information and keeping track of international transactions. Moreover, the IRS requires that anyone with a cumulative total of $10,000 in overseas accounts, at any point during the year, must submit an FBAR form annually.
To ensure you’re in step with all international finance and anti-money laundering measures, give us a call. Getting caught can lead to criminal charges; so the sooner you sort it out, the better. And note: Authorities look much more kindly on people who come forward voluntarily.
ICO Lawyer Tips: FTC Marketing Compliance
It’s time to market your ICO! Note: Rules and regulations apply! And yes: Cryptocurrency startups are subject to the same promotional constraints as every other brand and business.
The Federal Trade Commission has and will continue to go after ICOs for violating “unfair and deceptive” marketing standards. Moreover, it’s got a sharp eye on crypto airdrop events.
Don’t let your ICO flounder because of an easily avoidable FTC marketing violation. Our team can help make sure that doesn’t happen to you.
Connect With An ICO Lawyer
The Gordon Law Group regularly works with entrepreneurs, startups, and established fintech businesses on everything from contract negotiations to tax positioning to FTC compliance. Get in touch today to begin the conversation.