Cyprus welcomed initial coin offerings (ICOs) and cryptocurrency investments and, at the moment, stands out as one of the top investment destinations in this field. More importantly, those who are interested in how to start a fund in Cyprus must know that the financial authorities of the country have already created a legislative framework that can protect the interests of the parties involved in ICOs, which are one of the primary ways of raising capital for a cryptocurrency hedge fund. 
 

Foreing investors interested in how to start an investment fund in Cyprus through ICO benefit from the European Union’s single market, as the country is a member state of the community. As a general rule, ICOs can be launched in Cyprus through a Cypriot company or through alternative vehicles. 
 

The main benefits of launching ICOs in Cyprus are presented below: 
 

• a central time zone;

• access to the country’s large number of double tax treaties;

• acces to the EU single market;

• Cyprus has a white-list status amongst the countries with reputable tax authorities.  
 

As mentioned above, Cyprus benefits from a solid legislation regulation for ICO activities. The following rules of law can regulate financial activities carried out through ICOs:  
 

• The Payment Services Law 2009, which incorporates EU regulations;

• The Investment Services and Activities and Regulated Markets Law 2007;

• The Prevention and Suppression of Money Laundering and Terrorist Financing Law 2007;

• The Electronic Money Law 2012;

• The Prospectus Law 2005;

• The Alternative Investment Fund Managers Law 2013;

• The Alternative Investment Funds Law 2014;

• The Foreign Account Tax Compliance Act; 

• The Common Reporting Standard;

• EU Regulation 910/2014, legislation created for the use of electronic identification. 
 

The Investment Services and Activities and Regulated Market Law provides the legal framework concerning what is an investment activity in Cyprus. It gives a clear understanding on what constitutes a financial instrument or an investment service and foreign businessmen can contact our team of affiliates in Cyprus for in-depth assistance on the above mentioned regulations, and professional advice for launching initial coin offerings in this country.