You can see the rules and regulations in other jurisdictions.
The Basel Committee issued a statement on cryptoassets on 13 March 2019. It warns of the risks associated with cryptoassets and outlines the steps banks should take if they acquire cryptoasset exposure or provide related services.1
In response to the Basel Committee's statement, the National Bank of Belgium (NBB) launched Circular NBB_2019_20 on 19 July 2019 with regards to activities related to cryptoassets. This document was distributed to all financial undertakings under NBB supervision, as well as other entities who may be impacted by its content. The circular serves to reiterate and expand the scope of the Basel Committee's statement.2
In its ICO Communication of 13 November 2017, the FSMA adopted the perspectives expressed by the European Securities and Markets Authority (ESMA). This text, seen as a form of soft law, concluded that certain financial regulations such as Prospectus Directive, MiFID, Alternative Investment Fund Managers Directive and Market Abuse Regulation may be applicable depending on how ICOs are structured.3
Further, the FSMA states that the following legislation and regulations may apply to ICOs in Belgium1
According to the FSMA, the application of the above laws depends on how the ICO is structured, and this needs to be assessed on a case-by-case basis. FSMA does not explicitly state the criteria that it will use when undertaking this assessment, but it does mention elsewhere in its communication that:
Tokens may have characteristics such as:
Tokens and cryptocurrencies are classified as either: (1) an investment token; (2) a cryptocurrency; or (3) a utility token; or any combination of these three variations, which is gaining traction among scholars and policymakers. This trichotomy constitutes only a descriptive classification, but it can already indicate whether the coin will fall under a particular law (such as one discussed in Section V.2).1
In comparison to 2003/71/EC and 2017/1129, the Old and New Prospectus Acts do not refer to 'securities' when setting out the reach of the prospectus regime. Instead, they implement a much more expansive notion of 'investment instruments', covering not only securities but also an array of other products such as money market instruments, futures, forward rate agreements, equity swaps etc., and a broad residual category encompassing all types of financial investments without reference to underlying assets.1
Due to this, there may be a high chance that the token issued in an ICO qualifies as an investment instrument and therefore falls under Belgian prospectus regulations.1
Intermediation monopolies are also established by Belgian prospectus legislation. For purposes of placing investment instruments within Belgium, only regulated entities are permitted to act as intermediaries as defined in Article 21, Section 1 of the New Prospectus Act. Thus, only regulated entities (with a few exceptions) can act as intermediaries when a token qualifies as an investment instrument and is placed in Belgium.1
If a token is considered an investment instrument under the applicable prospectus legislation, it will also be considered a financial product and subject to the information obligations required by the Information Obligations Decree. This Royal Decree outlines what professionals must inform retail customers of when selling them financial products.1
Moreover, when a token or cryptocurrency service qualifies as a financial service, Book VI of the Belgian Code of Economic Law, which contains various consumer protection provisions, applies. A financial service is defined in this Code as 'each banking service or service relating to lending, insurance, individual pensions, investments and payments'.1
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