Doesn’t sound remotely shady at all.
Estonia wants your ICO, and they’re starting their own cryptocurrency to prove it. Dubbed Estcoin, it may well be the first government-backed cryptocurrency. There’s probably a reason why.
Still, Kaspar Korjus, managing director of Estonia’s e-residency program, makes the distinction that Estcoin isn’t “money”, but rather “tokens”. A necessary distinction as their agreement with the EU requires them to use the Euro as their official currency. As stated in his blog post:
Instead of giving up shares, many startups are now raising finance by issuing their own blockchain-based crypto coins to investors around the world.
The US, Singapore and Switzerland are currently the leading jurisdictions for entrepreneurs considering where to launch their ICOs, although all governments are still figuring out how to regulate ICOs. Unfortunately for both entrepreneurs and investors, that means ICOs continue to operate in what could be described as legal grey areas at best, while the lack of clarity and trust is holding back the benefits of this innovation in finance.
Despite this, the amount of money being raised globally by startups through ICOs is now far in excess of the amount being raised through venture capital. Raising finance is only half the story of ICOs though. People who invest in crypto tokens issued by a startup are then strongly incentivised to support the development of that startup in other ways too and they tend to form an online community.
E-residency for all
Oh, but you’re probably wondering about that e-residency program, huh? Well, basically, anyone can become a “resident” of Estonia through it, and arguably, that’s what the Estcoins are ultimately for. E-residents are given a card with a chip that uses 2048-bit public key encryption. Using that ID, they can use government services, start a company, or open a bank account in Estonia without actually being there. Ever notice how societal progress tends to go “boink”?
This activity already has a major positive impact on Estonia as e-residents bring a significant amount of business to the Estonian economy. An independent report released this month by Deloitte revealed that e-residents have already brought €14.4 million back to Estonia in the first three years and this is predicted to rise to €1.8 billion by 2025, which is a return of €100 for every €1 invested in the programme. We will only achieve this though if we continue to provide real value to our e-residents around the world.
The purpose of estcoin is to accelerate this, while also providing additional funds and interest for the development of our digital nation.
Oh boy. The future’s gonna be really entertaining.
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