News | 11 September 2019
Leading Australian law firm Hall & Wilcox is delighted to have advised Lex Exchange on Australia’s first digital currency exchange token offer, which included a world-first detailed tax disclosure.
Lex Exchange is a company at the forefront of new technology and innovation in blockchain technology and provides cryptocurrency exchange services. Through the digital currency exchange token offer, Lex Exchange plans to raise between US$2 million and US$12 million.
The Hall & Wilcox team, led by Special Counsel John Bassilios, advised Lex Exchange on income tax, GST and regulatory advice to ensure the token was not a security (financial product), reviewed the whitepaper and drafted the terms and conditions. The team also comprised Lawyers Joni Pirovich and Will Francis, Partner Anthony Bradica and Special Counsel Jim Koutsokostas.
‘We are proud to have been involved in the first offer of a digital token by a digital currency exchange in Australia and the first whitepaper in the world (that we are aware of) to include detailed tax disclosure for acquirers of the token,’ said John Bassilios.
‘Our cross-section blockchain practice group has the skills to advise on all blockchain-related matters from regulatory (including AFSL and AML/CTF) to tax to IP/IT and general corporate commercial.’
Joni Pirovich said the Hall & Wilcox team and Lex Exchange engaged early with the Australian Taxation Office regarding the tax implications of the token sale so that any material tax risk could be managed proactively.
‘This is a world-first detailed tax disclosure, which will help those acquiring tokens to be informed upfront about the general tax consequences of acquiring and using the tokens,’ Joni said.
‘The detailed tax disclosure sets a best practice standard, which we hope will be replicated for other token offers in Australia and in the world.’
Hall & Wilcox is leading the way in providing specialised legal advice in all areas of blockchain and cryptocurrencies, including regulatory, tax, IP and privacy. The firm was involved in making submissions to Treasury on its ICO consultation paper and assisted Blockchain Australia, the Australian Digital Commerce Association and Fintech Australia with their submissions.
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