On Sunday, October 28th, a report published by German business outlet, Handelsblatt revealed that the financial regulator of Germany wants to see an international effort to regulate Initial Coin Offerings (ICO), regardless of still being uncertain if it would ever transform into a “niche issue”.
According to Felix Hufeld, chairman of Federal Financial Supervisory Authority (BaFin), he said that German regulatory sources still have a very hawkish view on ICOs being a financial instrument.
In an interview with the German publication, Hufeld said, “The volume (of money) per ICO, as well as the number of ICOs, are both still increasing. even today Investors barely have any rights.”
Hufeld then added, “Thus, in my opinion, I would recommend private investors to keep their distance from such things.”
As per reports, as it was noticed back in 2017, several investors had been losing significant amounts of funds in many such schemes, Regulators all over the world have increased scrutiny on ICO tokens right from the start of this year.
Notably, in recent time U.S authorities have made public announcements stating that it would be keeping a close watch on the ICO space so that to avoid any fraudulent activities and ensure securities law compliance if such tokens constitute securities.
As per reports, traditionally, solely from a regulatory perspective, Germany has taken more of a global stance, and according to Hufeld, this regulatory move should boost the initiative off with a more mainstream push in future.
According to Hufeld, “So far, till date we are still talking about a niche issue,” Further adding, “It still cannot be said for certain that ICOs would become a standard part of the economy.”
Hufeld also added that in a long-term perspective, international standards would be much more “desirable”, also saying that discussions to that effect have already begun in “multiple international forums.”