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Crypto Launchpad: Which Jurisdiction?

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crypto7figs

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Mar 25, 2022
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I'm since last year searching a jurisdiction for a Crypto Launchpad.

First thought Cayman or BVI would be the best fit as it is crypto.
However, the new VASP is hardcore. They want us to KYC the users, which will be impossible.

DEXes and DEFI you only connect your wallet and do your thing, and no KYC is required.

Any recommendation on which jurisdiction and reputable law firms with expertise in crypto and smart contracts?

Last edited: Jun 24, 2023
 
  1. Price and do all business in Euro's
  2. Use no US infrastructure (servers, email providers, banks,‌ $)
  3. Have strong restrictions blocking Americans and America
  4. Do no business directly or indirectly with‍ the US or anything related to the US, this includes investment firms in BVI/Caymans that⁠ have American investors/owners or US companies backing them.

From there it's working out your market⁤ etc.

Fail at any of the above and you will likely spend millions in litigation⁣
 
Hmm, thank you for answering.

So basically I need to avoid the US at all‌ costs to don't have KYC? Or are there other reasons?

Not accepting US users aka‍ investor is doable, not investing in projects that have US owners is harder.
Plus avoiding⁠ every company provider of every platform service provider we use in the company is also⁤ difficult.
 
That would be the‍ best to do. You see, the banks also refuse US citizens if they live in⁠ the US. Too much trouble.
 
Spoke to a lawyer in the Cayman, and he mentioned that for countries like Cayman,‌ BVI, and other VASPs a meticulous KYC process is necessary.

When I asked about involving‍ US investors, firms, or shareholders, the lawyer advised me to avoid too.
If it's a⁠ non-investment-related service provider like a designer or marketer, there shouldn't be any issues.

I plan⁤ to explore SVG recommendations and other unregulated jurisdictions if anyone knows any other

I appreciate⁣ the help, folks
 
Please don't‌ discourage discussions. Feel free to motivate your answer with some examples of reputable crypto companies‍ based in SVG and explain how crypto in SVG is exempt from KYC obligations.
 
SVG is the only jurisdiction 100% free from any Crypto regulations, SVG legal system does‌ not introduce Crypto, so it is not established at the legislative level. Accordingly, SVG is‍ the best since it is traditional offshore with 0% tax and with no Crypto regulations.⁠
 
It is just a requirement to be registered, just underlining your business activity.

Here is‌ exact provision that identifies each individual as obliged to register.
 
I was just curious how a jurisdiction that's "100% free from any Crypto regulations" and‌ which "does not introduce Crypto" can also have a Virtual Assets Law.

In any case,‍ "(b) exchange between one or more forms of virtual assets;" seems like it would cover⁠ the proposed activities of @crypto7figs. Customers send stablecoins and get tokens back: i.e., exchange⁤ between two forms of virtual assets.

This means in SVG, this business would have to⁣ register, which in turn requires an AML framework. If we take that to be a⁢ reference to SVG's AML laws, it becomes clear that a KYC program of some sort︀ if required to run the intended business.
 
“So the Financial Action Task Force (FATF) on money laundering, which we’re all familiar with,‌ in St Vincent and the Grenadines and across the Caribbean because they’re constantly imposing new‍ regulatory requirements on us, they have expressed their concerns with the unregulated use of virtual⁠ assets.”

He said that at the beginning of the year, the United States government issued⁤ specific guidance on the use of virtual assets.

“And the FATF has issued a recommendation⁣ since October of 2018, in terms of virtual assets and virtual asset service providers, and⁢ has stated that virtual assets have become subject to anti-money laundering and counter-terrorist financing schemes︀ of countries.”

https://trinidadexpress.com/busines...cle_6e5aa934-d644-11ec-8f58-0b090ed68be4.html
By searching unregulated exchanges here: The Best Global Crypto Exchanges

I noticed︁ that many of the unregulated exchanges such as Kucoin, OKX, XT, BitMEX are registered under︂ Seychelles.

Edit: but found some news that Seychelles VASP regulation too.

What about Nevis or︃ Marshall? I caught that @Sols is not a fan of Marshall.
One detail is that︄ banking is good but not a deal breaker.

I would love to be as much︅ compliant with the laws, but the KYC here is the deal breaker.
Maybe simple KYC︆ may be doable, but the source of funds as Cayman requests is insane.
 
https://www.svgfiu.com/index.php/resources/law-regulations
Virtual Assets Act:

And:

This setup is similar to other crypto/VASP regulations, where that︄ regulation by itself doesn't contain much in terms of specific KYC provisions. Instead, it makes︅ reference to compliance with AML laws directly or through notices by the competent authority.

It seems like things are still in motion, but I don't see this regulation turning out︆ any other way than what FATF has decreed, which means KYC. They have already enacted︇ the law. Now they have to make it on par with international standards.
 
No, I find it much easier to just deal with regulation. The non-KYC crypto businesses‌ I've seen have either operated in jurisdictions with unclear laws (IIRC, US, Marshall Islands) or‍ simply don't disclose any company details, and behind the scenes they operate a network of⁠ more or less related entities that serve different purposes.

The ones with unclear laws will⁤ eventually catch up. No one is intentionally going against FATF. It's a bit like CRS.⁣ Just a matter of time until everyone is caught up.
 
I have cleared with SVG Compliance and as they have mentioned, "SAINT VINCENT AND GRENADINES‌ VIRTUAL ASSET BUSINESS ACT, 2022" is just passed and it is not active yet, so‍ @Sols you have confused me, so again here is a law that is not an⁠ active yet and SVG are 100% free from any kind of Crypto Regulations, for now.⁤
 
Any jurisdiction with simple KYC that does not require obligating the source of funds from‌ the users?

How do DEX and many launchpads work out there though?
Uniswap, Sushiswap, Pinksale,‍ none requires KYC

Do you know if it's possible to mitigate with a third-party solution⁠ that checks the wallets, for example:
https://www.scorechain.com/
And a side note, which countries other than⁤ the US should be excluded?
Puerto Rico, North Korea, China?, Russian?, etc
 
At the end︄ of the discussion again, my advice is correct, SVG has no any Crypto-related law in︅ force.
 
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