Financial regulators published new guidelines for the crypto initial exchange offerings but in the meantime, they banned initial coin offerings by individual token issues that are no longer permitted in the country as we are reading in the blockchain news today.

According to the reports, the Financial Regulators published a set of guidelines for IEOs today and with the new paradigm, crypto exchanges are now responsible for the token sale events. all crypto exchanges now have to undertake due diligence assessments for the token sales which will evaluate the token issuers in conjunction with the regulator. The exchanges registered as IEO operators will have to maintain a minimum paid off the capital equivalent of $1.2 million.

Furthermore, during the registering IEO platforms, the exchanges look to trade ICO tokens will now have to possess a digital asset exchange platform license. Back in 2018, the SC introduced a registration requirement list for crypto exchanges in the country. In the guidelines, the SC mandates that they have to hold incorporation documents in with at least one director resident in the country and the token issuers will have to have a minimum paid-up capital equivalent to $122,000.

The guidelines include investment limit clauses with retail investors that are allowed to place $500 maximum in any token sale. This figure is much lower than the limit that is set for equity crowdfunding which stands at $1,200. In the press release with the new guidelines, the SC promised to allow only tokens that follow strict assessment standards to be allowed for sale in the country. The regulator says that the new guidelines will help the IEO platforms to determine if a crypto token possesses a lot of value in regards to innovation or improvements to the current market.

With the token sales now available in IEOs, ICOs are illegal and now is one of the first jurisdictions that will pursue regulated crypto token sales via registered exchange platforms. The new regulatory framework will come into effect in Q2 in 2020. While the regulators are moving towards legitimizing IEOs, the US Securities and Exchange Commission has come to issue warnings about the IEOs claiming they are problematic from a regulatory standpoint.

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