Switzerland and Singapore are at risk of losing their edge in the business of fund-raising by issuing coins. Who is breathing down their neck?
Last year, three countries – the U.S., Switzerland, and Singapore – dominated league tables for initial coin offerings, both in volume of funds raised as well as planned and closed ICOs.
So far this year, hubs including the U.K. and Hong Kong are challenging that supremacy, according to a study by consulting firm PricewaterhouseCoopers. Britain notched up $507 million in ICO proceeds, more than Switzerland.
Both countries were blown out of the water by the Cayman Islands and British Virgin Islands. The Caribbean states led the table in terms of volume thanks to so-called «unicorn» listings including Eos' $4.1 billion coin issue and Telegram's $1.7 billion ICO.
Crypto Nations
The league table shifts underscore how traditional financial centers are angling for a piece of the crypto pie, as ICOs establish themselves as the new and alternative form of crowdfunding. Coin issues are icing venture capital for tech and blockchain start-ups, though hybrids including big investors like private equity as well as ICOs are also on the rise.
Smaller havens like Liechtenstein and Malta are scrambling to adopt laws governing blockchain, the technology which underpins cryptocurrencies. Gibraltar is also courting crypto providers by classifying tokens as commercial products – a friendly stance.
Several countries not otherwise known for their big finance hubs backed into the top ranks: Estonia, Lithuania, and Israel all sidled up to Switzerland's spot in the volume league tables so far this year.
Risk of Abuse
The study comes shortly after U.S. regulators said they would treat coins as securities – effectively, the same as stocks and bonds – but deferred some oversight to individual states. Meanwhile, Switzerland, which has dubbed itself «crypto nation» for the flurry of token providers which have settled in Zug's crypto valley, and Singapore elected to view coins more freely, as assets.
The two tiny financial powerhouses have adopted a more crypto-friendly stance than the U.S., where ICOs are increasingly registering with the Securities and Exchange Commission.
This stands in stark contrast with China and India, where regulators have either banned or severely cracked down following several high-profile scams. Three models of regulation are emerging: a securities view as in the U.S., a balanced view in Europe, and the binary approach seen in parts of Asia.
