ICO, Token, D-App and legality

[Chien]

Hello, I'm wondering about legal aspects of an ICO and in general on D-Apps world. Most of ICOs I've seen always involves companies that has to develop the "most innovative" technology, so they need monies to do that. But they are companies, they pay taxes, need KYC and so on... Now my question is: and if a private creates a D-App with a Token and people starts using it? Is it illegal? (generally speaking because crypto are so confused in the legal aspects right now), and if this individual is anonymous? What's happens?
For semplicity think an ERC20 token, I can buy it only in Ethereum, so no other currencies are involved.

[mu_enrico]

I think dApps has the spirit of decentralization (like cryptocurrency) so that it is censorship resistant, open, borderless, etc. The problem is that governments will try to regulate cryptocurrencies / dApps platforms without exception. I think this is not a battle that the companies can win. They need to operate legally if they want their business to grow.

[Chien]

It's a very interesting point of view.. How can a government could regulate an anonymous token or d-app? I'm curious to see what will happens in the next years

[BlueStackz]

It's a very interesting point of view.. How can a government could regulate an anonymous token or d-app? I'm curious to see what will happens in the next years

Government may not be able to regulate D-app, the only thing they can do is to give free license to those who wish to operate on a blockchain technology, you see, the whole idea of government involvement in projects or our lives is to make money, and the only way they can do that is to impose some laws and policies on people.

This is why the blockchain technology has been a threat to them, but if they manage it well, they can still achieve their goals by just allowing companies to register for a permit to operate on blockchain technology legally and have a fix dues for these companies to be remitting to them.

[ukloon]

It largely depends on where the country is that the company is operating from. Even if they use ethereum as their platform, the registered company could be in the USA so they need to follow the local laws for their ICO

[mu_enrico]

How can a government could regulate an anonymous token or d-app

EOS/ETH/TRON and other popular dApps platform aren't anonymous. The best privacy coins afaik are GRIN/BEAM since it removes all intermediary information.

Since dApps platform, by nature (POS), cannot achieve the level of decentralization as robust as bitcoin, it will be prone to government takeover.

[fasdorcas]

Sir satoshi created Bitcoin using he blockchain technology and has been anonymous ever since then after creating the coin and nothing has gone against him legally, if a private firm develops a D-app that is not to scam people, then I do not see why it should have any legal implications.

The whole idea behind the blockchain technology is that of anonymous system, so they must not operate legally since the identity has already been protected, because once a D-app application becomes legally registered, then it will be under the regulation of government. The product of the company itself is what is being decentralized and not the company, so they should still meet up with the obligations of paying necessary government dues.

[rijaljun]

Hello, I'm wondering about legal aspects of an ICO and in general on D-Apps world. Most of ICOs I've seen always involves companies that has to develop the "most innovative" technology, so they need monies to do that. But they are companies, they pay taxes, need KYC and so on... Now my question is: and if a private creates a D-App with a Token and people starts using it? Is it illegal? (generally speaking because crypto are so confused in the legal aspects right now), and if this individual is anonymous? What's happens?
For semplicity think an ERC20 token, I can buy it only in Ethereum, so no other currencies are involved.

That should be an illegal actions if we look it from government perspective, but it's okay is you look from crypto perspective. However when the regulation comes (from each country), they will be eventually asked by government like "where are your money from? why you have so much money? what is your job?" if they looks suspicious (like withdraw too much money to your bank account)

[starblocks]

If you're acquiring a token for use with a decentralized app it's likely to be classified as a utility token and therefore won't be illegal to use for that application, however, if you're investing into startups that offer tokens which have the properties of a security e.g. they offer a dividend then you may need to be an accredited investor especially if you're from the US and such offerings are banned in certain other countries so make sure you do some research before you make an investment

[Chien]

Thank you for your answers, I think it's very interesting this aspect of cryptocurrencies

[BitcoinHodler]

legality is not a global thing. it is instead local and depends on your local government. so some of them may outright ban anything related to ICOs involving the companies, the participants and the platforms and even imprison you if you get involved with them (there are countries that do that in real life!) and some other countries may let them grow but so far most countries have either banned ICOs or have no laws YET against them but nobody is looking at them favorably because of all the scams that keep happening using ICO model. not to mention that legit businesses never raise money like this.