Russian ICO Token Investors See Strict Rules with Limits of $1,500 Per Project and $9,000 Per Year
Russia has been sending mixed signals about its position on cryptocurrencies. It has passed a series of regulations both restricting and embracing cryptocurrencies.
Now Russian lawmakers have passed yet another policy that will allow ordinary Russians to participate in ICOs at set limits. Professional and institutional investors will also have a level playing field with other international investors.
Investment Cap At $9,000 Per Year
The State Duma has drafted a bill dubbed “On Attracting Investments Using Investment Platforms”. The bill, which was first read in May, has set out regulations under which ordinary Russians can participate in initial coin offerings, the IPO versions of the new cryptocurrency industry.
Under the new bill, ordinary Russians can invest up to $9,000 in ICOs in any given year. This amount is further required to be split among different ICOs, a regulation that is expected to mitigate and spread risk.
To this end, the maximum amount that one can invest in any given ICO project is $1,500. Doing the math, this means that ordinary Russians can now invest in as many as 6 ICO projects per year.
The new draft also offers exceptions for institutional and professional investors who may be willing to risk more than $9,000. However, strict requirements have to be met to enjoy these exceptions.
Institutional investors can invest as much as they wish in ICOs, according to the new draft. Private investors get to enjoy this privilege as well but only if they meet certain conditions. For starters, private investors seeking to exceed the set limit have to prove that they are worth more than $90,000. They also have to show that they have at least two years of experience working in the financial and securities markets.
Protecting Russians From Scammers
ICOs are a new phenomenon that many in the financial world did not think was possible. In just two years, the amount raised through ICOs has appreciated from about $200 million to over $6 billion. Certain companies such as Telegram, the encrypted messaging app, have raised over $1 billion in one sitting. However, ICOs are risky as investors are not given any guarantees or assurances that they will get returns on their investments. In fact, many projects funded through ICOs have failed or are failing.
Many governments around the world have been planning to crack down on ICOs. To this end, the recent draft by Russia has been proposed as a means of protecting Russians from potential scammers and fraudsters. The government is also urging the citizens to become better informed about crypto investments to stay safe.
One Among Three Drafts
The “On Attracting Investments Using Investment Platforms” draft is one among three that are designed to better regulate the cryptocurrency markets. One of the other two bills has been designed to define digital rights by amending Russia’s Civil Code.
The other, dubbed “On Digital Financial Assets”, introduces a wide range of policies regulations cryptocurrencies in general. All three bills will be discussed further and voted upon come January according to Anatoly Aksakov, the Chairman of the Financial Markets Committee.