Germany wants blockchain-issued shares for enterprises

According to the newly formulated legislation of the “Future Finance Act,” introduced by the finance ministry on April 5, the German government is pressing for more welcoming regulations for entrepreneurs working on financial innovation in the country.

Key objectives of the legislation include the digitalization of capital markets via the issuance of electronic securities on a blockchain and the enhancement of the portability of crypto assets. According to a translated version of the bill proposal, Germany’s “capital market should become more effective and modern in order to mobilize more private capital for future investments.”

The government’s objectives include fostering a favorable environment for entrepreneurs and investors. The legislation reduces the minimum market capital for initial public offerings (IPOs) from 1.25 million euros to 1 million euros and facilitates institutional investments in startups, small businesses, and special purpose acquisition companies (SPACs).

According to local media reports, the new regulations would apply to enterprises with fewer than 500 employees and less than 100 million euros in annual revenue.

“We want Germany to be the premier location for start-ups and growth enterprises.” ” Christian Lindner, the German finance minister, said in a statement. “This is why we are enhancing capital market access and making it simpler to raise equity. Additionally, small and medium-sized businesses will benefit from this.”

The government asserts that the change will make Germany more attractive to investors and foster a culture of stock market investing. The minister noted that startups, growth companies, and small and medium-sized businesses should have simpler access to the capital market.

Germany is a member of the G7, which consists of the seven largest democracies on the globe. G7 members are collaborating on stricter crypto regulations, which many in the industry believe could hinder innovation and development. At the upcoming May meeting in Hiroshima, Japan, the new agenda of the G7 is anticipated to be revealed.