Bitcoin, Blockchain, ICO, STO & TGE: Legal advice on crypto currencies
As one of the first law firms in Germany, the CLLB has positioned itself as an expert when it comes to legal issues relating to crypto currencies, blockchain, ICO, STO & Co. Lawyer István Cocron, as part of our team of experts, has also been honoured by the DGI Academy as a Certified Cryptography Practitioner, has a particularly high level of expertise and can also draw on numerous experiences in this field as a speaker at various national and international blockchain and ICO / STO events.
Our CLLB team of experts supports companies in all legal questions – especially in financing via an Initial Coin Offering (ICO) or Security Token Offering (STO). We also help you to use the blockchain in compliance with data protection regulations and provide comprehensive legal advice on the new means of payment Bitcoin, Ether, Onecoin, Litecoin, Monero, Ripple, Dash etc.
26th – 27th February 2020 – Participation Berlin Legal Tech Hackathon
18th – 20th February 2020 – Participation General Police Equipment Exhibition & Conference
4th/5th February 2020 – Participation Europäischer Polizeikongress
11th September 2019 – Participation BaFin-Tech 2019
23rd/24th May 2019 – Judge at STO Battle at Malta AI & Blockchain Summit
21st February 2019 – Speaker at Azhos Supply-Chain Innovation Day 2019
25th March 2019 – Speaker at Crypto Currencies, Security Tokens and Euro-on-Blockchain: What’s the Future?
24th January 2019 – Speaker at Crypto42 Watchdog 2019
21st January 2019 – Speaker at Investorenkongress Kryptowährungen und Blockchain
4th to 5th December 2018 – Participation Slush 2018
30th September to 2nd October 2018 – Participation Bits & Pretzels 2018
27th/28th June 2018 – Participation Blockchain Expo Europe 2018
25th/26th May 2018 – Speaker at Blockchainhotel conference 2018
14th to 16th May 2018 – Participation consensus 2018
26th April 2018 – Participation Blockchain Summit Frankfurt 2018
17th April 2018 – Speaker at the workshop „Blockchain – next digital Disruption?“
12th November 2018 – Bloomberg Interview: Berlin Bitcoin Ruling Spurs Industry to Seek Tax Clarity
27th June 2018 – Bloomberg Interview: Germany Reaffirms Crypto Tax Stance
14th March 2018 – Bloomberg Interview: Tax Hurdles Thwart Virtual Currency Surge in Germany
Legal advice Corporate finance / start-up financing via an ICO / STO
Companies, especially start-ups, often do not have enough money at their disposal at the start of business. Initial Coin Offerings (ICO) have proven to be a serious financing alternative to help start-ups raise sufficient sums for their business model. Within the framework of the ICO, the company creates its own tokens, which are sold to investors and investors who in turn hope that the success of the company will later increase the value of their shares. In contrast to a classic IPO – the Initial Public Offering (IPO) – the hurdles for an ICO are often significantly lower from a bureaucratic point of view alone. In addition to the ICO, the Security Token Offering (STO) is currently being developed – a financing method that stands for greater security and, according to experts, will replace the ICO in the long term. The STO is also very well suited for start-ups.
Due to the lack of regulation in many countries, ICOs and STOs are particularly attractive for companies, but contain many legal and regulatory pitfalls to consider. Companies can therefore not avoid legal advice on this financing model. CLLB already assists numerous companies in the preparation of whitepapers, organisation and development of a national and possibly also international company structure taking into account the respective regulatory and tax implications and has already successfully assisted clients with their ICO. Together we will be happy to provide you with legally compliant planning, preparation and implementation of an ICO / STO and look forward to hearing from you!
Rights and obligations of an ICO / STO
The financing method with an ICO or STO still leaves many questions open for companies, especially from a legal point of view. German law still lacks regulation by the legislator and the Federal Financial Supervisory Authority (BaFin), which is one of the reasons why it is not clear how the prospectus requirement for traded tokens behaves within the ICO / STO. Future regulation in accordance with the Asset Management Act (VermAnlG) is possible.
Good to know: Whoever has his company headquarters abroad, but also expressly courts German investors & investors with his ICO / STO, cannot avoid German supervisory law.
Although an ICO and STO is associated with some legal uncertainties, it can be carried out legally and professionally through competent advice and clean preparation. The CLLB team will be happy to advise you.
Tax consideration of crypto currencies
Anyone trading in crypto currencies must report any profits or losses to the tax office in order not to be accused of tax evasion by mistake. The Federal Ministry of Finance has already made it clear that every crypto currency is declared as private money and is therefore treated the same for tax purposes as assets such as your own gold bar or vintage car when sold. Income generated with crypto currencies is thus considered other income that must be entered in the tax return in the SO attachment. But not only the pure sale of the crypto currency must be considered fiscally. The following transactions are taxable:
- If the crypto currency is sold or exchanged back into a legal tender, e.g. Euro or Dollar
- When the crypto currency is exchanged for another crypto currency
- When a real good or service is paid for with the crypto currency
As proof for the tax office, the investor should keep a transaction diary which, among other things, records the time and quantity of the crypto currency acquisition. As a legal expert in the field of crypto currencies, we can offer you comprehensive advice on the statutory tax obligations when trading in crypto currencies and will be happy to support you in preparing your tax return.
How the CLLB supports you in legal questions about ICO, STO, Blockchain & Co.
Crypto currencies and ICOs / STOs as financing alternatives are a hotly debated topic in the financial world. In Germany there is still a lack of regulations and companies are quickly confronted with a multitude of unanswered questions:
- How can I legally implement an ICO or STO in Germany?
- What do I have to consider for tax purposes when selling tokens in the context of an ICO or STO?
- What rights do investors & investors have after a token purchase?
We advise companies to obtain comprehensive information on legal issues if they are considering entering the crypto currency, ICO, STO and TGE business.
For this purpose CLLB Rechtsanwälte has founded a team of experts, which among other things is very familiar with corporate financing via an ICO or STO and the creation of its own crypto currency or token. Continuous further training in this area is a matter of course for us, which is why we use numerous trade fairs and conferences to observe current developments in this area and to expand our know-how. Attorney István Cocron, part of the expert team and founding partner of the law firm CLLB, has also been awarded the title of Certified Cryptography Practitioner by the DGI Academy.
Our specialists are available at any time to assist you with legal questions around the topics Blockchain, ICO, STO, TGE and Cryptocurrencies. The team already has a wealth of valuable experience and advises numerous companies and start-ups who want to include the topic of blockchain in their business model or expand the use of it.
By the way: If you are looking for software for control reports for Bitcoin and other crypto currencies, we recommend our cooperation partner CryptoTax. With the following affiliate link you get to the registration page: Register for CryptoTax.io
Basics: What does STO mean?
STO is the abbreviation for „Security Token Offering“. The STO has evolved from the ICO and can therefore be regarded as a future successor to this form of financing. Due to numerous ICO fraud cases and the resulting first prohibitions and prohibitions of ICOs by the BaFin, ICOs have come under increasing criticism. For this reason, STOs are currently developing as a subgroup of the generic term ICO as a safe alternative. While with the ICO investors do not have anything „solid“ in their hands and do not know exactly what is happening with their money, this is not the case with the STO. The investment in the context of an STO is conceptually a tokenized right, similar to a security, like shares, bonds or profit shares in the form of profit participation rights, – only in digital form and in connection with the blockchain technology. In this context, BaFiN also speaks of securities-like tokens (WPÄ). In many countries, STO Exchanges are currently being set up in parallel, as almost exclusively utility tokens and crypto currencies can be traded on the previous crypto exchanges.
Basics: How do I perform an ICO or STO?
Anyone who decides to carry out an ICO or STO must consider a number of aspects that need to be clarified beforehand. The following is a rough explanation of what you need to consider when dealing with an ICO or STO:
Select suitable token
- security tokens
- utility tokens
- asset tokens
- currency tokens
Often, the choice falls on the utility tokens, as these are easier to handle for the founders and do not require prior regulatory approval and permission from the German financial supervisory authority BaFin.
Select Platform & Technology
- Description of the technology used
- Description & introduction of the concept team
- Project Description & Solutions
- Identification & handling of risk factors
- Information on the technical system architecture
- Current market data & estimates for market growth
- Requirements for the publication of the tokens and their subsequent rights of use
- List of team members, consultants and partner companies
Obtain legal advice
Development of a prototype
Design your online presence
- Produkt- oder Projektbeschreibung
- Product or project description
- Description of the token and the platform used
- Presentation of the team and the partners
- Explanation of the roadmap
Develop marketing strategy
About Lawyer István Cocron
Mr. Istvan Cocron studied Law in Munich and graduated as a Lawyer in 1999. He worked in a variety of law-firms including: ‘Eschenweck’and Munich. Between 2001-2002, he worked as a Lawyer in Munich and in 2004 became a founding partner of the well renowned Law firm: CLLB Rechtsanwalte. In 2017 he became a member of ‘Reporters without Borders’ and in 2017 was admitted as an Advisor to the Federal Office of Economics and Export Control. This is how Mr. Cocron derived his entire Source of Wealth.
Current business activity
Mr. Cocron is a well-known German Lawyer. He currently specialises in providing advice to start-ups and companies, provides consultancy on corporate and investment law, and policy-holder representation.
He has extensive corporate experience and has already supervised several major proceedings for investors and consumers from all over Germany.
Mr. Cocron has been working for several years in the Fintech sector, particularly in the topics of blockchain and cryptocurrencies.
He has many years of experience in the field of national and international foreclosure, is a member of several creditors‘ committees and national and international associations of lawyers.
He is also a member of the following stakeholders:
- the Arbeitsgemeinschaft Bank- und Kapitalmarktrecht of the German Bar Association
- the Munich Bar Association
- the German Bar Association
- the Interessengemeinschaft Deutscher Strafverteidiger before the International Criminal Court
- the European Bar Association
- the Magic Circle Germany
- Reporters Without Borders