ICO alternative: First ETO from Neufund on 27 November

World premiere in Germany: The Berlin fundraising platform Neufund has announced the date for the world’s first equity token offering (ETO). On November 27, investors can acquire shares in Fifth Force – if they can afford it.

Clear legal situation of cryptosoft

Initial Coin Offerings (ICOs) offer companies an attractive way to achieve an immense reach for fundraising with relatively little effort. Due to numerous regulatory imponderables, however, many companies (allegedly even a silent majority) still shy away from carrying out an ICO. The fundraising cryptosoft platform Neufund enables the acquisition of legally binding company shares in the form of tokens for the first time at the end of November according to onlinebetrug. The Equity Token Offering (ETO) is the first of its kind worldwide and promises greater legal certainty than ICOs.

The operating company of Neufund, Fifth Force GmbH, may serve as guinea pigs. From 27 November, interested investors will have one week to place themselves on the whitelist for the ETO. The subsequent public sale is scheduled for seven days and ends on 15 December. This was announced by Neufund on his blog on 20 November. Newfound CEO and co-founder Zoe Adamovicz is correspondingly euphoric:

“More than a year ago we announced that we would make the first legally binding offer from Tokenized Equity on the blockchain in 2018, and we are sticking to this plan. The first ETO will be the ultimate showcase for our product”, Adamovicz said in the note.

High entry threshold – thanks to crypto trader

However, anyone wishing to participate in the ETO must have the appropriate small change. Contrary to Newfoundland’s claim to make investments accessible to everyone, the minimum crypto trader investment amount for the ETO is 100,000 euros. Read more about it: https://www.forexaktuell.com/en/crypto-trader-scam/

Neufund shows whether this decision has been contrite – and blames BaFin:

“Neufund’s platform is ready to carry out the ETO 2018 as promised, but with the unexpected request from BaFin we have to raise the minimum ticket size for this ETO to 100,000 euros – so we don’t have to wait any longer to show you our product.

The “request”, to which Neufund refers, refers to a request by BaFin, which called on Neufund “at the last minute” to audit its own technology. Neufund lets it shine through that one was coldly caught by this decision:

“Such a request has neither a legal reference in the existing regulation nor in the guidelines of the BaFin and has never before been addressed in the context of our dialogue”.

The high minimum deposit underpins the regulatory authority’s attempt to keep small investors out of the crypto market as far as possible. It is also questionable whether Neufund actually expected such a request. A company claiming to merge the worlds of crypto currencies and equity transactions by blockchain should not be surprised if the highest securities supervisory authority keeps a close eye on it.

The legal situation for public ETOs in Germany is clear, although not progressive. The same rules as for securities apply to ETO tokens, which receive the mandatory classification as security. These include the obligation to publish a prospectus, ad hoc reporting obligations, organisational and behavioural obligations, regulations prohibiting market manipulation, regulations prohibiting insider dealing and the Market Abuse Ordinance.

Further details on the ETO will be announced by Neufund at the start of the whitelisting phase on 27 November.