The impact of regulatory developments on initial coin offerings (ICOs)

source

Ofcourse like everything in the cryptocurrencies space which could be influenced by changes in regulations that is also the same for initial coin offerings (ICOs) which are often subjected to be impacted by the development in regulations which often determines the way these ICOs are conducted and development in regulations also leads to changes in how they are being regulated, all in all regulatory developments have had notable impact on initial coin offerings and I will break down some of this impacts.

Key Impacts of regulatory developments on ICOs

Well in recent times due to the growth in regulations development especially in most countries on cryptocurrencies and everything that deals with it or even due to the fact there in growing regulatory development this has no doubt impacted ICOs in that there has been an increased in compliance requirements which is to say now users are mandated to comply to KYC(know-your-customer) regulations and AML(anti-money laundering) regulations which has no doubt led to the much higher cost for those willing to participate in ICOs and increased the difficulty level of those wanting to conduct ICOs in the first place, yes level of complexity has been greatly increased due to tighter regulations.

Also growing regulatory development has also caused needless delays in the business of the day. In that both investors and issuers are now skeptical due to the legal uncertainties. Legal uncertainties has led to investors pondering each step before Investing into this projects and even those issuing are rather skeptical leading to hesitation from both parties and this has made it increasely difficult for these ICOs project to operate as effective as it would like to due to difficulty in navigating the legal landscape surrounding it and the potential uncertainty which has caused delays and fear of legal risk has contributed to this delays which is a bad impact no doubt.

In recent times due to tighter restrictions it has affected to a great extent those who can participate ICOs. Depends on the area but in some regions certain users are limited to participate in ICOs largely due to small capital or being a retail investor whilst in other places restrictions are imposed on those who do not have the all the accreditation as that's the only way retail investors could even dare to join.

Also development in regulations has actually help in curbing fraudulent ICO projects as this has led to increased oversight and enforcement. Now due to the growing regulations it has made it easier for ICOs who are not compliant to regulations or fails the regulatory requirements to face proper legal punishment as scam project will be forced to face prosecution for releasing scam project and tainting the image of this space and ICOs in general which no doubt will help maintain a measure of integrity in the market whilst acting as a safe guard for ICO investors.

Well one good thing though about growing development in regulations is that it helps to provide clear regulatory framework for initial coin offerings and this help to guard issuers and investors alike which no doubt help to folster innovation and ensure that token offering projects are completely compliant to proper legal framework.

Conclusion

Well the world is advancing and no doubt with its advancement comes changing regulations and development which ofcourse has impacted the manner ICOs are conducted and how they are regulated as well as who can participate in them and this development has helped to provide a proper legal framework for all issuers and participants to follow which is a welcome development as long they learn to navigate their way.