What Are the Best Countries to Launch an ICO? An In-Depth Look.

A critical factor to consider when planning an ICO is the regulatory environment it’s launched in. In this article, we profile eight countries that we’ve identified being the most friendly towards ICOs and crypto-startups. 

Read on for a quick look at the nations that have the most cryptocurrency-friendly regulatory systems.

Note: This overview is provided for informational purposes only and should not be considered legal advice. Rather, is intended to provide a starting point for further research. If you’d like to add information to this article, please reach out to us via email or in the comment section below.


If you’re a UK citizen, you may want to consider setting up your ICO in Jersey–  a British island territory located near the coast of Normandy, France. Jersey has business-friendly tax laws and is in the process of developing specific cryptocurrency-friendly regulations.

In 2014, the Jersey Financial Services Commission (JFSC) approved the launch of the world’s first regulated bitcoin investment fund. The following year, the government introduced this Regulation of Virtual Currency Policy Document:

“Following the consultation exercise and further policy consideration, the Government has arrived at a policy position in respect of the regulation of virtual currency. Ultimately, the aim of this policy is to further enhance Jersey’s proposition as a world leading Fintech jurisdiction.”

Jersey became the home of first government-licensed ICO in December 2017, with the launch of a coin called ARC (ARC Reserve Coin). ARC is an asset-backed stablecoin cryptocurrency that’s designed to resist price volatility.

The government of Jersey recently published guidance for how ICOs should operate. The ICO issuer has to be a registered Jersey company, obtain consent from the JFSC and follow AML (Anti Money Laundering) standard practices. (For more information, read the official guidance note.)


The government of Spain is considering a number of cryptocurrency-friendly policies, including tax breaks for companies in the blockchain technology sector.

Barcelona recently announced that it would launch a specialized blockchain space in the city’s tech hub to promote blockchain innovation. In addition, Spanish bank BBVA became the first global bank to use blockchain technology to issue a loan. The governor of the Bank of Spain also came out in favor of cryptocurrency, though he did also note that “the technology is not yet mature.”

The main downside of launching an ICO in Spain is high taxes. Profits gained from cryptocurrency transactions are taxable under the Law on Income Tax of Individuals. On the other hand, bitcoin transactions are exempt from Spain’s VAT (Value Added Tax).


Post-Soviet state Belarus is another country that is actively trying to attract cryptocurrency businesses.

A presidential decree that came into effect in March of 2018 guarantees that all income generated by mining and operations in cryptocurrencies will be totally exempt from taxation until 2023. The same decree specifically states that ICOs, cryptocurrency miners and cryptocurrency exchanges are allowed to operate in the High Technologies Park territory.

Belarusian statesman Vsevolod Yanchevski provided the following statement about the High Technologies Park to CoinTelegraph:

“The Decree, developed on behalf of the President of Belarus, really turns Belarus into one of the most comfortable places in the world for conducting IT business. Moreover, the powerful positive effect of the Decree will be felt not only by the IT sphere, but by the entire economy of the country. “

Though Belarus’s tax free offer seems like a good deal, businesses should consider all the factors involved before choosing to set up in Belarus. Since 2006, Belarus has been the target of a number of human rights sanctions.

The Cayman Islands

According to the Library of Congress, the Cayman Islands “appear to have a fairly flexible regulatory environment” for cryptocurrency startups and ICOs.

As is the case in most countries, the regulatory picture around cryptocurrencies in the Cayman Islands is still not clear. However, Cayman Islands Premier Alden McLaughlin has personally invited cryptocurrency startups to set up shop at Cayman Enterprise City.

During a recent conference attended by cryptocurrency leaders from around the world, McLaughlin pitched the island nation as “the gem of the Caribbean” and “one of the foremost financial centers.”

One potential downside to headquartering in the Cayman Islands is that the labor pool is underqualified for cryptocurrency jobs. Cayman Enterprise City CEO Charlie Kirkconnell told the The Cayman Compass that he’s working on developing a solution. His company recently signed a deal with the US-based school Code Fellows.

“One thing we need to respond to is many of these companies are looking for qualified, trained technical people, and that’s a bit of an issue here. So we’re aiming to create a locally available critical mass of technical talent from local community.”


The wealthy land-locked country Luxembourg seems to have a more open stance toward cryptocurrency compared to other EU countries, according to the Library of Congress’ report. Luxembourg is one of the few countries in the world that officially recognizes cryptocurrency as actual legal currency.

In an interview with The Luxembourg Times, Luxembourg’s Minister for Finance Pierre Gramegna shared his pro-cryptocurrency views:

“We believe, along with others, that this is an unstoppable phenomenon that brings added value and effective services to the consumer. This should, therefore, develop.”

He went on to explain that Luxembourg treats cryptocurrency companies as financial service companies. At the same time, cryptocurrency-to-cryptocurrency transactions “do not enter the field of taxation.” Any transaction involving a fiat currency, however, can be taxed.

Despite this guidance and the fact that the Luxembourg government seems to be embracing crypto technology, current regulation is somewhat murky overall. This lack of clarity can lead to delays. For example, it took Luxembourg-based bitcoin trading platform BitFlyer two years to obtain a financial service license.


Switzerland’s Canton of Zug is now promoting itself as a cryptocurrency hub. The local government in that region has even decided to begin accepting bitcoin and ether. This may benefit companies that intend to offer an ICO, because the costs associated with establishing a corporation in Zug can now be paid in bitcoin. Ticino– another Canton of Switzerland– even allows its residents to pay their taxes with bitcoin, but only up to CHF200 (approximately $210 USD).

The government of Switzerland regulates ICOs differently, depending on the nature of their cryptocoins. There are three categories: payment tokens, utility tokens and asset tokens. Payment tokens are coins like bitcoin that are typically used to facilitate value transfer. Utility tokens enable access to a specific application or service. Asset tokens provide their users with equity in a company. The most regulated type of token is the asset token. Asset tokens are treated as securities and require the authorization of the Swiss Financial Market Supervisory Authority. In addition, some types of ICOs may require the coin issuer to obtain a banking license. What’s more, all Switzerland-based ICO issuers must comply with the country’s AML (Anti Money Laundering) requirements.

Companies considering starting an ICO in Switzerland should consult with a tax expert first. The country treats cryptocurrencies as foreign currencies for tax purposes and are subject to a special wealth tax.  Though each Swiss Canton can use different numbers for determining taxes, they generally follow the guidance of the Swiss Federal Tax Administration. In 2017, the recommended tax rate for bitcoin was CHF13,784.38, or approximately $14,514 USD.


The government of Singapore has taken a decidedly hands-off approach to regulating cryptocurrencies. This laissez-faire attitude has made the sovereign city-state a hub of cryptocurrency business activity. However, this official announcement from the MAS (Monetary Authority of Singapore) seems to indicate that it may be introducing new regulations soon:

“MAS’ position of not regulating virtual currencies is similar to that of most jurisdictions. However, MAS has observed that the function of digital tokens has evolved beyond just being a virtual currency. For example, digital tokens may represent ownership or a security interest over an issuer’s assets or property. Such tokens may therefore be considered an offer of shares or units in a collective investment scheme under the SFA.”

No specific regulations have been issued  yet. However, Singpore’s Deputy Prime Minister Tharman Shanmugaratnam recently stated that the country’s fiat anti money laundering laws also apply to cryptocurrencies.

“When it comes to money laundering or terrorism financing, Singapore’s laws do not make any distinction between transactions effected using fiat currency, virtual currency or other novel ways of transmitting value.”

A proposed Payment Services Bill could expand the scope of cryptocurrency regulation. If passed, the bill will require ICO issuers to follow anti money laundering standards. In addition, tokens that qualified as securities could be subject to additional regulations.


Like Singapore, Malta’s lack of cryptocurrency regulations have made it a popular spot for setting up a cryptocurrency business. It’s home to Binance– one of the largest cryptocurrency exchanges in the world.

Another similarity that Malta has with Singapore is that it is also developing new cryptocurrency rules and regulations. However, government officials have indicated that the coming regulations will be generally supportive of the industry.

At the beginning of 2018, Digital Economy Parliamentary Secretary Silvio Schembri has stated that future regulations are “not going to be about sun and favorable tax rates.” At the same time, he also promised to create a framework that encourages cryptocurrency business to come to Malta.

The government of Malta proposed a number of new regulations in 2017, including the establishment of a Malta Digital Innovation Authority, a new framework for the certification of distributed ledger technology platforms and a Virtual Currency Act.

According to the proposal, ICO issuers have to complete a number of steps in order to do business legally in Malta. Prior to the ICO, an appointed Systems Auditor will have to review the work of the systems developer involved in the ICO and report their findings to the MFSA (Malta Financial Services Authority). The MFSA would also need to approve the company’s white paper prior to the launch of the coin. The government distributed the proposal to cryptocurrency leaders to ask for feedback.

Three cryptocurrency bills became law in July of 2018. One of the new laws– the Virtual Financial Assets Act (VFA Act)– applies specifically to ICO issuers. An in-depth analysis of the law is available here.

Malta’s new laws seem to have been well-received by the cryptocurrency community. Forbes cryptocurrency reporter Rachel Wolfson wrote that with these new regulations, Malta is “sure to become an early pioneer in economic innovation.”

Final Thoughts

Given all the factors involved in issuing an ICO, it is difficult to single out a single country that could qualify as the absolute best place to startup a new coin. Each cryptocurrency-friendly nation referenced in the Library of Congress study has unique benefits and disadvantages.

Malta and Singapore seem to have established themselves as crypto-friendly nations mainly due to their relatively laissez faire regulatory attitudes, but both countries have recently adopted new regulatory regimes. In both instances, the new laws seem to have been well-received. Therefore, it is not hard to imagine that both island nations will continue to be hubs of cryptocurrency industry activity moving forward.

European regions like Jersey, Luxembourg, Spain and Switzerland offer comparative stability, but high taxes and slow bureaucracies could be a potential roadblock for some ICO issuers. The government of Belarus has tried to entice cryptocurrency companies with zero tax promises, but it has been hit with numerous human rights sanctions and accusations of corruption over the years. The Cayman Islands is openly friendly to cryptocurrency businesses, but the local talent pool may still be quite thin.

Alex Munkachy

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