JOURNAL OF STRATEGIC INNOVATION AND SUSTAINABILITY
Blockchain in Startup Financing: ICOs and STOs in Switzerland
Author(s): Galia Kondova, Geremia Simonella
Citation: Galia Kondova, Geremia Simonella, (2019) "Blockchain in Startup Financing: ICOs and STOs in Switzerland," Journal of Strategic Innovation and Sustainability, Vol. 14, Iss. 6, pp. 43-48
Article Type: Research paper
Publisher: North American Business Press
Abstract:
This paper provides a comparative analysis of the new blockchain-based start-up and small companies funding methods, namely, initial coin offerings (ICOs) and security token offerings (STOs) against the backdrop of traditional fundraising methods like venture capital and private equity building on the experience of Switzerland. In particular, the comparative analysis is based on a theoretical overview of the nature of these blockchain applications, the relevant legislative framework as well as recent market developments with a focus on Switzerland. The paper concludes that both ICOs and STOs are characterized by lower entry barriers for investors and higher cost efficiency as compared to traditional start-up fundraising methods. However, STOs provide more security to investors than ICOs due to their wider regulation.