CINDX LEGAL: HOW CINDX IS ENSURING LEGAL COMPLIANCE

CINDX
CINDX
Published in
3 min readJul 5, 2018

CINDX takes its business seriously with particular attention and cares to legal matters. We follow the letter of the law and want to give our investors the grounds to trust us. In the following series of articles, you can learn more about CINDX’s responsible approach to legal matters.

Our company is registered in Estonia. Why? The answer is simple — the authorities of Estonia have created a strong and innovative legal infrastructure and legislative base for projects like CINDX, and have shown loyalty and encouragement to blockchain startups.

Estonia has demonstrated that it is a very progressive jurisdiction, with projects like e-Residency and Public Notary. On its ‘Ease of Doing Business’ scale, Doing Business 2017 ranked Estonia as the 12th among 189 countries.

In short, Estonia shows a very friendly attitude toward blockchain technology and other progressive technological fields. As such, the country is attracting a growing number of blockchain companies, including CINDX.

Specific Information on Estonian Legislation Relevant to CINDX

On March 26, 2018, the Estonian Financial Supervision Authority issued recommendations for organisers and participants of ICOs/STOs.

The recommendations have acted as an accurate and detailed guide to our current and future activities. The document has defined the position of the EFSA concerning carrying out ICOs/STOs. According to the document, violation of the current legislation (i.e. if the prospectus of the issue hasn’t been registered) will result in punitive measures.

Because Estonia is one of the first countries to draft the relevant legislation and to regulations for blockchain startups and cryptocurrencies, it is also one of the first countries in which it is possible to carry out cryptocurrency-related matters freely.

More specifically, rules regarding the exchange of cryptocurrencies are defined; rules on carrying out ICOs/STOs have also been established. Additionally, Estonian regulators are open to dialogue with representatives of blockchain businesses.

The EFSA has also declared that in certain circumstances, tokens which are issued within an ICO can be regarded as financial instruments. Tokens that grant holders certain rights on the issuing platform, or tokens whose cost is tied to future profit or activity of the company, will most likely be recognised as financial instruments.

Therefore the release of cryptocurrency tokens (which can be regarded as financial instruments) can raise the issue of whether tokens will be regulated by the legislation relevant to securities and the stock market.

To legally distribute CINDX tokens (which are non-depository securities), CINDX needs to have the organisational and legal structure of a Joint-Stock company. For this reason, CINDX is now reconstructing its structure from Limited Liability Company (LLC) into a Joint-Stock company.

About CINDX

CINDX is an investment platform that allows its users to combine several crypto exchange accounts into one trading terminal, and gives them the option to copy the best managers without having to transfer their funds.

Moreover, implementation of blockchain-based transactions on CINDX will allow its users’ trading history to be saved. A reputation rating system will be used to differentiate the successful managers from the less-successful ones.

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