The Future Finance Act and its significance for crypto equities

With today’s publication of the Future Financing Act in the Federal Law Gazette, Germany is entering a new era of corporate financing. This law, which entails a large number of changes to stock corporation, capital market and tax law, is not only relevant for start-ups and SMEs, but also has a profound impact on the crypto market.

A boost for crypto stocks

The Future Financing Act significantly facilitates access to the capital market for start-ups and growth companies, which is particularly important for companies in the field of cryptocurrencies and blockchain technology. The innovative introduction of the crypto share, which enables shares to be issued on the basis of blockchain technology, opens up the Stock Corporation Act to electronic registered and bearer shares. This move is indeed revolutionary, as it not only regulates the issuance of crypto shares, but also builds an important bridge between the traditional financial markets and the innovative world of cryptocurrencies.

The introduction of the crypto share signals a significant recognition and integration of blockchain technology into German financial and capital market law. This allows crypto companies to benefit from the advantages of the regulated capital market, while at the same time utilizing the unique features and benefits of blockchain technology, such as transparency, security and efficiency. The ability to issue shares on a blockchain could simplify and speed up the process of issuing shares, which in turn makes raising capital more efficient for start-ups and growth companies.

In addition, the introduction of the crypto share could increase interest and acceptance of cryptocurrencies and blockchain-based solutions among the wider public and traditional investors. This could lead to further legitimization and integration of these technologies into the general economic system and thus promote the development and growth of the crypto sector in Germany and beyond.

Expansion of the scope for structuring in stock corporation law

The Future Financing Act revitalizes the concept of multi-voting shares, a significant change that can give holders of registered shares up to ten times the voting weight. This innovation is specifically designed to make it easier for start-ups and growth companies to go public by securing the founders’ control over their companies even after the IPO. This regulation considerably expands the scope for structuring in stock corporation law and could be of particular interest to crypto companies, which are often managed by a small group of founders or investors.

The reintroduction of multi-voting shares offers a strategic option for crypto companies that want to maintain their innovation and agility while facing the challenges and opportunities of the public market. This type of share enables the founders to make important decisions and steer the direction of the company without having to hold the majority of the capital. This is particularly relevant in a fast-moving and ever-changing market such as cryptocurrencies, where strategic flexibility and the ability to react quickly to market changes are crucial.

In addition, this change could also attract the interest of venture capitalists and strategic investors who want to invest in innovative crypto companies without undermining the control of the founders. This could lead to increased investment activity and an increased flow of capital into the crypto sector, which in turn supports the growth and development of the industry. Overall, the introduction of multi-voting shares is an important development that has the potential to significantly impact the landscape of corporate finance in the crypto space.

By the way: Other important aspects of the Future Financing Act

The Future Financing Act, which was published today in the Federal Law Gazette, includes a number of changes that go far beyond the introduction of the crypto share and the adjustments to company law. These changes affect various areas of securities law, investment law, insurance supervisory law and other relevant areas of law.

Some of the key aspects of the law include:

• General securities law and debt securities: The Act brings changes to general securities law and debt securities in terms of the regulation and treatment of different forms of securities.
• Investment system: Adjustments are also being made in the area of investment, which could be of significance for investors and fund companies.
• Insurance supervision and insurance contract law: Changes in these areas could have an impact on the way insurance products are regulated and marketed.
• Employment contract law: The Act also affects employment contract law, which is particularly relevant for employee share ownership.
• Stock exchange regulations and management fees: Adjustments to stock exchange regulations and management fees could affect access to the capital market and the cost structure for companies.
• Money laundering: The law also contains provisions to combat money laundering, which is important for all financial market players.

These changes show that the Future Financing Act is a comprehensive package aimed at modernizing and strengthening the German economy and the financial market. It not only offers new opportunities for crypto companies, but also for a variety of other players in the financial world.

Conclusion and further information

The Future Financing Act is a significant step towards a more modern and flexible financial world in Germany. It offers opportunities for innovation and growth in various sectors, from crypto stocks to traditional financial services. For a detailed insight into the law and its provisions, you can view the full text of the law here.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.