Raising funds for startups financing through digital tokens: global practice
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Original Article|Economics
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Introduction. In recent years, blockchain technology has been actively applied in various areas of the economy. New innovative companies are increasingly turning to initial digital coin offerings to raise the necessary funding.
The purpose of this study is to review the existing sources regarding the coin offering process in blockchain markets and to present an overview of the individual elements of these processes. Due to the novelty of the industry, the author aims to systematically define the exact coin offering process, identify the projects geography, evaluate the regulatory framework and other inherent characteristics and challenges associated with the topic. The findings will be useful to investors, regulators and specialists studying the cryptocurrency industry, as well as small and medium-sized enterprises seeking funding.
Materials and methods. Such universal methods of scientific cognition as analysis, synthesis and generalization were used in the work. The research also collected and analyzed statistical data, normative documents and legislative framework.
Results. As a result of the conducted research, different types of digital coins were identified, the relationship between the choice of jurisdiction and its legislative base for coins placement was deduced, and the token placement procedure was described. In addition, the study revealed the problem of information asymmetry in the relations between investors and entrepreneurs placing their tokens. The reasons why companies may prefer new types of financing with blockchain technology to traditional methods of raising capital were analyzed. The author's definition of the concept of tokens was given. The reasons for the lack of financing of enterprises at the federal and regional level were highlighted.
Conclusion. As the conclusions the study highlighted the reasons why companies choose digital coin financing methods. It also identified the main problems associated with the supply of tokens: insufficiently developed legislative framework in a number of jurisdictions, including in the form of insufficient investor protection and the use of untruthful signals by companies in the process of raising capital.
The purpose of this study is to review the existing sources regarding the coin offering process in blockchain markets and to present an overview of the individual elements of these processes. Due to the novelty of the industry, the author aims to systematically define the exact coin offering process, identify the projects geography, evaluate the regulatory framework and other inherent characteristics and challenges associated with the topic. The findings will be useful to investors, regulators and specialists studying the cryptocurrency industry, as well as small and medium-sized enterprises seeking funding.
Materials and methods. Such universal methods of scientific cognition as analysis, synthesis and generalization were used in the work. The research also collected and analyzed statistical data, normative documents and legislative framework.
Results. As a result of the conducted research, different types of digital coins were identified, the relationship between the choice of jurisdiction and its legislative base for coins placement was deduced, and the token placement procedure was described. In addition, the study revealed the problem of information asymmetry in the relations between investors and entrepreneurs placing their tokens. The reasons why companies may prefer new types of financing with blockchain technology to traditional methods of raising capital were analyzed. The author's definition of the concept of tokens was given. The reasons for the lack of financing of enterprises at the federal and regional level were highlighted.
Conclusion. As the conclusions the study highlighted the reasons why companies choose digital coin financing methods. It also identified the main problems associated with the supply of tokens: insufficiently developed legislative framework in a number of jurisdictions, including in the form of insufficient investor protection and the use of untruthful signals by companies in the process of raising capital.
Keywords: blockchain, initial coin offering, startup financing, tokens, information asymmetry, digital rouble
УДК: 336.74:004
ВАК: 05.02.04
ГРНТИ: 06.01.11
Article received: August 22, 2023
Article accepted: October 05, 2023
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© Article. Alexander S. Gaida, 2023.
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