The use of fund proceeds and the risks involved should be made known to the stakeholders. Singapore Exchange (SGX) has disclosed the guidelines for listed companies who want to conduct ICOs (initial coin offering) and it includes the fact that all appropriate revelations are made.
According to Tan Boon Gin, the Chief Executive Officer of SGX RegCO, “First off the bat, it is important to make clear that even if an SGX-listed company is the issuer of a digital token, those tokens are not listed on SGX. Therefore, SGX’s rules would cover only the company and not the tokens nor the holder of the tokens.”
To make sure the shareholders of the issuer are properly informed so as to make better investment decisions, all listed issuers who want to carry out the sale of digital tokens have been mandated to reveal all relevant information such as AML (anti-money laundering) checks, calculated risks involved, KYC (know-your-customer) checks, how the raised funds will be disbursed, the basis for the ICO and many more to SGX RegCo.
In the same line of thought, issuers are also asked to provide auditor opinion and legal opinion on the Initial coin offering accounting treatment and it should be from reliable, certified firms.
Furthermore, Tan Boon Gin noted that any listed issuer who want to conduct an initial coin offering should get in touch with SGX RegCo ahead of time. “We retain the right to require additional opinions to be obtained so as to ensure that the relevant statutory requirements are complied with,” he added. “We will also provide a checklist to the listed issuer on the compliance matters that should be addressed.”