lithuania cryptocurrency icos

Lithuania The Latest Country to Target Initial Coin Offerings (ICOs) For Regulation

Cryptocurrency, Initial Coin Offerings (ICOs)–Initial coin offerings, the controversial but effective method for raising funds for new cryptocurrency projects which has managed to dominate the industry, is under attack yet again for its volatile investment scheme, lack of regulation and overall trust-less presentation.

On Wednesday, authorities in Lithuania held a seminar poised at examining the “threats and potential benefits” of the ICO industry in relation to the country’s economy. While reports last week out of BitMEX revealed that ICOs, despite the falling price of Ether and otherwise negative press, had managed to break even in terms of profit and loss thus far in 2018. However, earlier reports did point to a general decline in the ICO market, with fewer projects being initiated compared to the first half of the year. Despite the falling price of both the crypto markets and Ethereum–which provides the ERC-20 token basis on which most ICOs are developed and invested with–ICOs have managed to thrive throughout most of 2018, with the volume of total projects launched doubling that of 2017 within the first six months of the year. Again, last week’s report that ICOs had managed to break even on revenue, despite the otherwise abysmal market landscape, is positive news for the profitability of launching a coin project via the ICO route.

However ICOs, throughout their duration have been fraught with lack of regulations and an otherwise lawless market setup. Research earlier in the year concluded that near 80 percent of ICO projects launched in 2017 could be classified as “scams,” an otherwise disturbing result but one not surprising consider the lack of oversight and novelty of the ICO market. While economists and lawmakers may wag their finger at the form of raising capital, they have to keep in mind that bad actors will always be drawn to hotspots for new capital, particularly in the current landscape of poor crypto-based education and lack of market policing.

Now Lithuanian politicians have come forth to levy their concerns against the ICO market, a development that seems to be recurring in countries across the globe. New York City has already been chastised for driving out much of the blockchain and crypto-based enterprise, and ICOs provide one of the most simplistic means for new innovation in the field–even if they come at the cost of potential scam. Lithuanian authorities, including a representative from the central bank, came to the conclusion that cryptocurrency and digital assets have made for a substantial market in the country, with the turnover of crypto to fiat being described as “huge,”

“Virtual currency has huge cash flows, but (there are) worries about converting them into dollars and euros as quickly as possible, (and) leaving virtual currencies as quickly as possible.”

Despite their general concern over cryptocurrency cash flow and the Wild West style of the ICO market, Lithuania has decided to create a regulatory body to oversee the developing industry, with a particular nod towards the benefits that could come from crypto and blockchain. However, ICOs will continue to present a problem for greater oversight and anti-fraud measures, with FCIS deputy director Mindaugas Petrauskas saying,

““According to ICO figures, Lithuania is one of the world leaders and shows the highest, 305 percent, growth from all over the world.”