Germany’s Neufund shuts down security token platform, saying BaFin failed to act. Launched in 2016, Neufund helped allocate some $19 million in capital through novel equity and security token offerings (STOs), including a blockchain-based initial public offering in 2019. The firm claims to have some 11,000 investors across 123 countries.
In a statement, Neufund CEO and co-founder Zoe Adamovicz said the security token project could not continue to operate in a regulatory grey area. No legal action was ever taken against the startup, yet requests for guidance were not answered due to “fear of new technologies,” she said.
“The problem is that nobody wants to take the responsibility for neither letting innovation happen, nor for banning it,” Adamovicz added, placing the blame squarely at the feet of Germany’s Federal Financial Supervisory Authority (BaFin). “We were neither allowed, nor not allowed. BaFin’s default answer is to shy away from risk and responsibility.”
“Many European countries had aspirations to become a blockchain-friendly hub … [T]he authorities have stifled this plan, blocking the innovation in its tracks,” the firm wrote in a blog post Monday.
Adamovicz said the firm will transition to a yet-unannounced project. The current Neufund platform will be maintained including all equity tokens, wallets and post-investment activities, a blog states.