Preparing an ICO? You are certainly looking for the ideal jurisdiction to run your token sale. And you have certainly heard about the British Virgin Islands (BVI).
In this guide, we’ll explore why this jurisdiction is indeed a good pick for a token issuance, and how to go about it with minimal hassle.
A reference for offshore business, the British Virgin Islands (BVI) are a haven for initial coin offerings and token sales.
In the BVI, a crypto license is not required to launch a token. It is entirely legal and has multiple advantages in terms of corporate structure, taxation (absence thereof, to be clear) and privacy.
The British Virgin Islands are to offshore jurisdictions what Porsche is to automobiles: a high-end, highly popular and proven solution.
While the advent of new financial technologies and especially crypto represent a challenge for every nation, the BVIs used their experience and standing to further reinforce their position as a financial and business hub for the world.
The creation of a framework to regulate virtual asset services providers was elegantly designed. It provided a strong foundation for attracting crypto companies into the BVIs while not discouraging token issuers from registering their structures in the jurisdiction. We listed three major advantages of choosing the British Virgin Islands for selling your token. The three of them are hardly found in other jurisdictions, making BVI a no-brainer in the eyes of our regular clients.
You just want to launch your token. You are reading the blog of a legal services company and we know this is not what you would like to do the most right now.
We also want you to focus on the key point of your project. And thanks to the simple, straightforward corporate rules and processes in the British Virgin Islands, we can offer you this peace of mind.
A BVI structure is set-up in about a week, requires minimal documentations, needs no fluff. With our help, it’s even simpler: you provide a couple documents and you just wait a few business days.
This is what you want to hear if you just read about the European MiCA requirements for issuing a crypto-asset: there are no such things in the British Virgin Islands.
No registration required, nor crypto licensing process to foresee, before issuing your token with a British Virgin Islands legal entity. You are only liable to your investors and community.
Now, there is a crypto license in the BVIs, but it is absolutely not required for emitting a selling a token. And you can absolutely issue your token in the BVI while being registered and regulated in a different jurisdiction.
A structure registered in the British Virgin Islands is not liable to taxation. Therefore, the sale proceeds of your token issuance will not inflate your taxable income by stacking into your balance sheet.
As most ICO are conducted in order to kickstart a project, sometimes very close to the first round of funding, this is a major advantage. This is actually a reason enough to pick the BVIs over most “on-shore” jurisdictions, when your crypto project needs to cash to start growing and cannot afford to lose 20-30% of the proceeds of the sale immediately.
This has a beneficial effect on how the project will be viewed by investors and funds. As your cash flow is free of the burden of taxation, this directly shows on the soundness of your project’s finances.
In the virtual space, being pseudonymous is the rule. The project is virtual, the token is virtual, so why your identity shouldn’t stay virtual? Despite a few rare cases of abuses, regulators never came up with a generally accepted answer to this question.
The British Virgin Islands allows for a few legal options that allow directors and shareholders to enhance their privacy. While the argument of fighting fraud is often put on the table, privacy of a startup is actually a way to protect yourself and your assets from over-regulation in the early stages, giving you room for growth when it is the most critical.
It is important to note that the British Virgin Islands do enhance privacy but are still compliant with international standards.
Beside potential “good-to-have” legal packages, a legal entity for your token sale in the BVI costs less than $5,000 with a full year worth of assistance, all requirements taken in charge. LegalBison stays on your side during and after the ICO.
When the cost of a BVI structure is put beside the absence of taxation, this usually represents major savings and a major room for development for upcoming projects with a token sale.
Running an ICO in the British Virgin Islands is not difficult at all and simply requires proper planification. Your steps must be assured. The process isn’t necessarily long or complicated, but the legal work behind the sale must be properly done.
A Special Purpose Vehicle (SPV) is a legal entity (a company, for example) whose role is to raise and hold funds for a project launch. SPVs are commonly used to facilitate project developments and financial structuring, which is exactly what we want to achieve.
A company registered in the British Virgin Islands therefore works as an SPV for an ICO. The laws and regulatory framework of the BVIs, including the VASP regime, doesn’t interfere with the legal capacity of a company to conduct a token sale.
When forming an SPV in the British Virgin Islands, all legal formalities must be meticulously completed. We offer BVI SPV registration that is tailored to meet the specific needs of your token sale, providing a flexible and efficient structure to manage the funds raised. By working with our experienced legal professionals, you can navigate the process smoothly and ensure that your SPV is optimally positioned to support your ICO.
Beside the formation of a legal vehicle (the company in the BVI), a properly run ICO goes with a set of lawyers-prepared documents. There are no obligations per se in the British Virgin Islands, it’s just good practice, for the security of the team and the community.
Here are examples of what our experienced lawyers can do to optimize your project and protect you from serious liabilities:
To conclude, it is fairly simple to ensure the legality of your token sale in the BVI. It’s just about doing the right steps in the right orders. And with LegalBison’s assistance, you are guaranteed that the whole structure is properly set, in a short time, for you to focus on the token generation event.
By running your ICO in the British Virgin Islands with LegalBison, you benefit from:
