What is a VFA and what does it mean for 2gether 🛰️

You’ve probably read already that 2gether intends to issue the 2GT Token, an ERC-20 token, as a Virtual Financial Asset (VFA) in Malta. But, as a 2gether user, you might be wondering what does this really mean for you and for 2gether.

The regulation 📚

Malta, an EU member, is a pioneer in the blockchain space, as it’s the first jurisdiction to introduce a regulatory framework for blockchain and DLT technologies, including all the use cases around it. Part of this framework is the so-called Virtual Financial Assets Act (VFAA), regulating token sales.

The scope of the VFAA is to create the game rules for Token Sales. It gives specific requirements for the drafting of the Whitepaper and defines the category under which the token falls. The Maltese regulator, the MFSA, has created a Financial Instruments test which helps categorize tokens into three key categories:

1. Utility token. Usually considered as a virtual token
2. Security token. Generally captured under MiFID II and the local Investment Services Act, and therefore considered a financial instrument
3. Virtual Financial Asset (VFA). Tokens that can be considered neither electronic money, virtual tokens nor security tokens

In addition, the regulation requires the issuer of the VFA to appoint a VFA Agent to provide guidance through the whitepaper registration process and to validate it, as well as all the operations during and after the token sale to ensure the issuer’s regulatory compliance. The VFA Agent must be authorized by the MFSA to act as such, and will manage the registration process of the whitepaper on behalf of the VFA issuer.

Other European countries are also working through ESMA to establish a common framework to regulate, and countries such as France are pushing for short-term deadlines. We expect that in 2020 other European countries follow Malta’s example and implement similar regulatory frameworks.

What is 2gether doing about it? 🔧

2gether is built on trust and transparency, and we believe that issuing a fully regulated token is the best way to generate trust among the community and 2gether. That’s why, during the past months, we’ve been working to have our 2GT Token in full compliance with the legislation, with a view to issuing it as a VFA.

In order to do so, 2gether is working with Camilleri Preziosi, a leading Maltese law firm, and Uría Menéndez, a European-based global law firm. Camilleri Preziosi is going through the process of becoming a VFA Agent, through one of its subsidiaries. If everything goes according to the Plan, we expect to work on the whitepaper and hopefully have it approved during 2020.

How does it affect me? 🛡️

Our objective is to make the 2GT Token one of the first regulated tokens in the European Union. We believe that by doing so, we can provide both users and investors with a token that meets rigorous legal expectations.

This means that 2gether will not issue the 2GT Tokens until the MFSA authorizes it. Until that moment, you’ll be able to invest in 2gether through a Simple Agreement for Future Tokens (SAFT), a standard contract that gives you the right to receive a number of 2GT Tokens once we’re able to issue them, which is expected to happen in 2020. The SAFT agreement has been thoroughly built with help from Camillieri Preziosi and Uría Menéndez.

Join 2gether now! 🙌

To download 2gether, you just need to click here!

To learn more about 2gether and the 2GT, you can visit our web or read our recent article about the 2GT Distribution and Supply.

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