Tax Considerations in Initial Coin Offerings

As a new asset class, tokens and coins are upending traditional funding in ever-changing new and creative ways. This creative destruction has been mostly positive, but sometimes difficult as such capital raise structures add an increasing layer of complexity and risk that many issuers and investors have not previously encountered. Securities laws and tax considerations are two areas where Initial Coin Offerings (ICOs) have seen healthy debate–and for good reason. Consequently, both regulators (SEC and IRS) and advisors (investment bankers and consultants) have been forced to scramble as they seek to play catch-up to the quickly evolving industry landscape. Understanding