On April 5, the German Finance Ministry introduced the legislation of the “Future Finance Act”, which talks about more digitization of capital markets through new financial innovations such as the issuance of digital securities via blockchain.
It is also intended for the examination of improved portability of crypto assets.
Remarkably, the legislation also emphasizes flexible regulation and a favorable atmosphere for Start-ups, growth companies, and small and medium-sized companies to have easy access to the capital market.
Federal Finance Minister Christian Lindner stated in the legislation, “We want to make Germany the leading location for start-ups and growth companies. That is why we are improving access to the capital market and making it easier to raise equity. Small and medium-sized companies will also benefit from this.”
The proposed legislation of the Future Finance Act outlines extensive measures and bundle regulations from company law, capital market law, and tax law.
This new law simplifies the process for institutional investors to invest in startups, small businesses, and SPACs, and also lowers the minimum market capital required for initial public offerings (IPOs) from 1.25 million euros to 1 million euros, making it easier for these entities to go public.
If the proposed set of rules and laws passes, it would be implemented relevant to companies with a workforce of up to 500 individuals and generating revenue under 100 million euros.
Germany is a member of the Group of Seven (G7) countries, which are in the process of forming strict regulations to control the crypto space in order to protect consumers.