Category: White Paper

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5 ICO Myths Busted

Categories Blockchain, Cryptocurrency, ICOs, Technology, White Paper

 5 ICO Myths Busted

More and more people are looking to invest in blockchain companies but there is still a lot of concern around the validity of ICOs. When it comes to making investment decisions, it can be pretty hard to separate the fact from the fiction. Here are a few common ICO myths, busted.

ICOs guarantee success

When you invest in an ICO there is absolutely no guarantee of success, in fact, an estimated 50% of all ICOs will fail, meaning you have a 1 in 2 chance of success. Whilst these figures should not scare you off, they should encourage you to exercise caution whether you are launching an ICO or investing in one. Do your homework and research and be sure of what you are getting yourself into before you put your money where your mouth is.

ICOs are quick

Whilst ICOs are often considered as a quicker way of raising funds when compared to Venture Capital methods, there is no way you can launch a successful ICO in a few weeks. It takes considerable time to write a whitepaper as well as to build up a large community and digital footprint that will encourage investors. You are looking at a minimum of 6 months for the pre-public engagement phase and at least 3 months for the post-public engagement phase.

Tokens and coins are the same thing

Many people make this mistake and use the term token and coin interchangeably, but they are not, in fact, one and the same. If you are looking to invest in it, or launch an ICO you need to understand the fundamental differences between them. A coin has a single utility and stores just one level of value, whereas tokens have more than one function and can store a range of value levels.

All white papers are factually sound

Whilst it can be easy to notice incorrect or fraudulent statements in a white paper, it can be harder to detect factually incorrect data that sounds right. TRON is a good example of a white paper that was actually plagiarized, but that seemed legitimate therefore diminishing the credibility of the industry.

All listing sites are created equally

There is a huge selection of ICO sites available to choose from, but not all are equally useful. Some sites just list the project, but others go above and beyond and give investors a lot of information to work with. When you check out an ICO site, be sure to check out any ICO reviews that can help you to understand how a site analyses and weighs any listings it chooses to display.

 

Interested in ICOs Legislation in Malta? Contact us directly on +356 20103020 or by email at [email protected] to find out more.

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Secrets of a successful ICO Whitepaper

Categories ICOs, Malta, Law, Technology, White Paper, Funds

Secrets of a successful ICO Whitepaper

Whilst Initial Coin Offerings have been around since 2013, it wasn’t until 2017 that their potential was realised and their popularity skyrocketed. In the most basic of terms, an ICO is an alternative way of crowdfunding except that investors receive crypto tokens in return for their investment. The concept of an ICO has allowed any kind of investor, anywhere in the world, to have the opportunity of investing in new projects, that was once reserved for professional and institutional investors.

By the end of 2017, the amount of funds raised by ICOs exceeded $4.9 billion with some projects raking in around $700 million each. Then as 2018 started, the number of ICOs increased dramatically. Knowledge of this new type of fundraising became mainstream and by the end of Q2, the amount of money raised via ICO was already double what had been raised in the entirety of 2017.

Whilst the growth of the market is a positive thing, more ICOs means much more competition for start-ups looking to fund themselves in this way. Couple this with increased regulatory scrutiny and bad actors causing doubt in the market, the need to make your ICO stand out has increased significantly.

This is where the white paper comes in.

What is an ICO White Paper?

Every ICO needs a white paper to be legally compliant in a growing number of jurisdictions.

A white paper is a document that seeks to provide potential investors with all of the information that they need to know about the ICO and the product or service that is ultimately being offered. It should describe in detail the problem that the product is solving, the solution, its architecture, and the interaction with its users.

This is not a document that can be created in a week, but it rather requires in-depth market research and highly detailed reporting, combined with savvy copy that will interest, intrigue, and motivate investors. Care must be taken to remain factual throughout because the whitepaper is the cornerstone of the startup’s credibility and just one small error can be the difference between success and failure.

The perfect white paper has to strike a careful balance between fact, information, and pitching to ensure that it is accessible and interesting to any kind of reader, but that it also provides all the details required to give investors the full picture. Attention must also be given to any regulatory or legal requirements imposed by the applicable jurisdictions to ensure that the white paper and the project is fully compliant.

What should a good white paper contain?

A good white paper should contain the following:

Executive Summary

This should give readers a good idea of what the white paper is about by summing up all of the key points in just two short paragraphs.

The Problem

This section must consist of market research and an in-depth explanation of the problem that exists within a particular market.

The Solution

The solution must describe how the proposed product will solve the aforementioned problem, and how it will counteract the issues raised during the market research.

Description of the product

In this section, a full description of the solution/product/service must be given including all features and specifications.

Tokenomics

Here, the token sale and the token economics must be detailed carefully and accurately so that investors know exactly where their investment is going, and what they will receive in return.

Roadmap

The startup must outline every ICO stage that the project will be rolled out over subsequent months/years, and the use of funding as and when each goal is achieved.

Team

Providing information about the team behind the ICO is imperative for building trust and credibility. Details need to be given about the relevant experience of each team member, and their responsibilities in the project.

Legal Requirements

Depending on which jurisdiction the ICO is operating in and from, there will be certain legal requirements that you are bound to include. These as a standard, comprising of a Disclaimer, Company Information, and information on sources of funding.

Creating a whitepaper

Creating a whitepaper is not just a matter of ticking off these sections and presenting it to investors; care, time, and careful consideration need to be given to each and every section, and it is advisable to have it checked by a legal professional with experience in the sector.

If you are considering launching your ICO in or from Malta, there are rules that you have to adhere by. Furthermore, as new legislation comes into force, any white papers that were launched before November 1st 2018, need to be rewritten and amended so that they are compliant.

E&S Group reviews and amends white paper to ensure it is legally compliant. Remember that you cannot have an effective ICO without a winning white paper so making sure you get it right is the key to your success. To find out more about E&S Group ICO Legal Service send us an email on [email protected].

 

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Why are white papers important for DLT companies?

Categories Blockchain, Cryptocurrency, ICOs, Smart Contracts, Technology, Tokens, Utility Tokens, Security Tokens, White Paper

Why are white papers important for DLT companies?

White papers have always been a very effective way of marketing and promoting virtual currencies. Back in 2008 when Bitcoin first launched, it was marketed through its own white paper that was said to be penned by Satoshi Nakamoto. Since those early days, almost every project on the market has been introduced via a comprehensive white paper, and now, in some jurisdictions such as Malta, this is actually a legal requirement.

Now, when the developer of an ICO is considering marketing, they have much more advanced methods at their disposal such as webinars, social media, and animated presentations. This does not mean, however, that the importance of a white paper should be discarded.

The purpose of a white paper

A white paper is a definitive guide to a project that gives the investor all of the information they will need to make a decision whether to invest or not. The main aim is to present a problem that exists within a particular sector, and then explain how the developer and the project will solve it.

The paper will also incorporate the philosophy of the company including its rationale for why it is needed a well as clearly illustrating how the model will make money.

A white paper needs to share the following information about the business:

  • The long-term goals of the company and the vision of the project
  • A problem that exists within a particular sector or market
  • A solution to the problem
  • Information on the founders, ambassadors, advisors and anyone else involved in the project
  • Information about the business
  • Technical information about how the problem can be solved
  • The tokenomics of the ICO itself

Why is a white paper important?

The truth is that very few companies will be able to hold a successful ICO without a good white paper to present with it. This paper needs to explain the scope of the project in detail but also in a way that is accessible and understandable. By creating a document that can be freely distributed, it can reach those that may not have access to a webinar or conference.

A serious investor is not going to waste time and money investing in a project that lacks the basic information on its technology. The same idea applies in presenting information to the developers and the founders of the project.

If there is no white paper, or the white paper is badly written or missing key information, most will assume that the ICO is not legitimate and it will raise a number of red flags.

How to create your own white paper

But writing a good white paper is not easy as the author has to strike a careful balance between legal compliance, being technical but accessible, and providing all of the information required in a way that is easy to read and interesting. In most cases, it is not something that a developer can write in a couple of days- it requires the input of a professional.

At E&S Group we are able analysed your white paper with the appropriate format and technical details needed.  Our team of lawyers, marketing experts, writers, and ICO specialists are on hand to ensure that your white paper ticks all of the right boxes and will be of interest to all of the right people. Send us an email on [email protected] or by telephone on +356 2010 3020

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The Importance of Legal Advisors in ICOs and Blockchain Projects

Categories Blockchain, Cryptocurrency, ICOs, Law, GDPR, Tokenomics, Tokens, Guest Post, White Paper, Know Your Customer, Anti Money Laundering

The Importance of Legal Advisors in ICOs and Blockchain Projects

GUEST POST BY The Tokener

 

Legal advisors are like the internet connection. When you have it, you forget about the importance of it. Once you lose it you find out all the things you can’t do without it. It is easy to forget about the importance of a good legal advice, so let’s try and recollect all the important things legal advisors do for an ICO.

Setting up an ICO is not an easy task. There can be a lot of bumps down the road so it is essential to make sure that everything runs as smooth as possible. Roadblocks in the legal area are one of the main problems most ICOs encounter. Any legal issue that ICO encounters is a huge red flag for potential investors. Because of that, the best ICOs have a legal department on point.

Reputation

World of ICOs and Blockchain is still pretty unregulated, because of that, it is easy to damage the reputation of an ICO. This can happen for a wide variety of reasons – from false scam accusations to the unclear roadmap, or token use. Having an experienced legal advisor can save you from these issues.

The legal advisor should be familiar with and present in every key aspect of an ICO, starting from the whitepaper. First, you need to decide terms and conditions of your whitepaper. Every piece of content in the white paper has to get the green light from the legal advisor. Keep in mind that courts, investors, and regulators rely on the whitepaper to understand how the project will work.

Token Model

The token itself needs to be verified by the legal advisor. With your legal team, you will need to decide whether your token will be considered a payment token, utility token or asset token. This is a very important decision and different choices can lead to different outcomes in terms of the project compliance with the regulations.

KYC/AML Evaluation

When all of that has been done, you will need to make sure that your ICO complies with all the possible regulations. The most important ones are KYC/AML (Know Your Customer/Anti Money Laundering) regulations which help ensure that your project is safe and secure from potential scams. It is not an easy work; it takes a lot of knowledge in order for everything to run smoothly. The Blockchain industry regulations are just starting to kick in, so it is best to have an experienced legal advisor on the team.

Intellectual Property Protection

Imagine that you prepared everything for the start of an ICO campaign. Suddenly someone accuses you that you stole their logo. You should worry about the project, but now you are stuck in the legal labyrinth. This is a disaster! Because of this, legal advisors are essential. They will make sure that all your domain names, trademarks, copyrights, trade secrets and patents will be protected and will be acknowledged as your intellectual property. These are not the thing you want to worry about when preparing an ICO launch.

GDPR

GDPR (General Data Protection Regulation) is another thing your ICO will need to comply with. Without this, your ICO can’t reach its full potential. Having a GDPR protocol is now considered a standard in the world of ICOs. All of this is in the realm of your legal advisors.

Conclusion

Getting a legal advice might be the best first step of every ICO project. It will ensure that everything is protected and in sync with the regulations. The creative potential of the founders will not be held back by unnecessary legal troubles that may pop up. Everybody involved in the project can focus on what they do best and not worry about regulations.

If you are looking for a legal advice for your ICO, the best time to get one was yesterday, the next best time is right now. If you have any questions please contact us at [email protected] or phone us on +356 2010 3020. Visit this link for further information regarding our ICO Legal Services. We are here for you!

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What to consider when creating an ICO

Categories ICOs, Law, E&S Group, Technology, Tokenomics, Tokens, White Paper

What to consider when creating an ICO

Over the years, Malta has built up a solid reputation as a leading jurisdiction for iGaming, fintech, and financial services. With these foundations already in place, it was a matter of natural progression for it to become the new global home for ICOs.

In May of this year, the Maltese government announced three new acts that would seek to provide legal clarity and regulatory certainty for ICOs, virtual currencies, and blockchain technology and service providers. The move has been welcomed by the international cryptocurrency community and it has now put Malta well and truly on the map when it comes to those looking for a suitable place to launch an ICO. But what else should you consider before getting the ball rolling?

Create a whitepaper

You can have the best idea, the best team, and the best planning in the world, but if you don’t have a truly excellent whitepaper then your project is doomed before it has even started. As well as now being a legal requirement, the whitepaper will allow you to clearly and succinctly communicate your concept to those that are interested in investing in it. This is not a document that you can write yourself in a few hours, you need to enlist the help of a professional to ensure that not only do you include all of the required information but that you also tick all of the regulatory boxes. The document should include what problem the ICO offers a solution to, the vision, what the course of action will be, business issues, a full description of the product, and how it will be marketed. If the whitepaper doesn’t answer every question that potential investor might have, then it isn’t doing its job properly.

Consider ancillary services

Setting up an ICO is not just creating a whitepaper, advertising it on Reddit and then waiting for the funds to roll in- you need to consider things such as bank accounts, tax implications, company registration, legal advice, and more. For these issues, you need to enlist the help of a specialist within the jurisdiction the ICO will be set up in. E&S Group can offer you step by step assistance from A to Z.

Tokenomics

Having a great idea is just one part of the puzzle- knowing the intricate ins and outs of how the ecosystem will work is something a little bit complex. Having the correct tokenomics can make all the difference between a successful ICO and one that fails, so finding a suitable tokenomics advisor is a necessity. This skill set is not something that everyone can offer, but at E&S our team of financial experts, accountants, business advisors, and crypto specialists can guide you through the four main areas of consideration for creating the perfect ecosystem.

Attracting the right investors

Attracting the right investors is paramount to your success. Even the best ideas and projects will fail if they are not getting noticed by the right audience. There is a range of different ways that you can seek to publicise and market your ICO and knowing how to do it in a way which is effective and lucrative whilst still retaining reputability, is something that needs some professional input. From social media to specialist databases and PR to your marketing plan,

Are you legally compliant?

With new regulations due to come into force in Malta, adherence to the rules should be at the forefront of your business plan. Understanding EU requirements in terms of KYC and AML, as well as issues such as the classification of securities, is something that a specialist should be assisting you with. Ensuring that you are in full compliance with all applicable laws, rules, and regulations will save you many problems in the future, as well as enhance your credibility on the market.

Whilst the ICO sector is only a couple of years old, the professionals at E&S have already amassed a wealth of hands-on experience in planning, developing, executing, and marketing compliant and successful ICOs. Why not contact us today to see how we can give you and your project the boost that it needs?

 

If you have any questions in relation to ICOs, please contact us on [email protected]

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