Tips for successfully raising funds for a blockchain project

Tips on how to successfully finance a blockchain project are now becoming particularly important, given the rapid development of the digital asset market and the increasing demands for transparency from regulators. Unlike the period of rapid growth of cryptotechnology in 2017-2018, when many projects were launched without a clear legal structure, the modern stage is shaped around a high-quality legal framework and a well-considered strategy. According to the estimates of analytical agencies, the global decentralized solutions industry could reach $4 trillion by next year, which opens up a wide range of opportunities for startups. At the same time, competition is increasing, and investors are becoming increasingly demanding in terms of regulatory compliance and a transparent business model. For those considering raising capital for a digital startup, the issues of choosing a country of incorporation, drafting legal documents and building a robust corporate governance system remain relevant. Incomplete aspects can cost a project its reputation and deprive it of access to strategic partners.

Cryptoproject funding: the new norm of tech entrepreneurship

In recent years, investments in blockchain startups are no longer perceived as something experimental. Large venture funds are already considering such projects on a par with traditional IT companies, which creates more serious requirements for project documentation, token model and ownership structure. In addition, this year we see a high level of involvement from international regulators: a number of countries have introduced licenses requiring projects to obtain permits for transactions with digital assets, as well as to comply with enhanced KYC/AML rules. Of course, these processes require a deep understanding of lawful nuances and detailed planning from future founders.

A key factor for the successful launch of a crypto startup is demonstrating a transparent and responsible position to investors. The traditional approach to the development of an IT business involves the legalization of intellectual property rights, the definition of key roles in the team, and the justification of the financial model. In the case of a blockchain project, there is the additional question of how the token will be categorized and used, who will be responsible for its issuance and distribution, and to what extent the project intends to attract retail or institutional investors. Since there is no single global regulator in the digital asset industry, startup authors must navigate several legal systems at once, choosing the most optimal one.

For many investors, an important criterion is the fundamental compliance of technological innovations with corporate governance requirements. Product creators should understand that there is fierce competition in the market, and in the presence of numerous alternatives, preference is most often given to initiatives that already have conditions for attracting investors to a blockchain project and a reliable lawful framework. In this case, “reliable” should be understood as not only well-designed investment agreements, but also a well-thought-out token distribution system, consideration of the team's interests, and a transparent control model. It is important for investors to know how exactly the conflict will be resolved if the founders disagree or decide to leave the startup. From this point of view, legal elaboration provides a guarantee that the business will not collapse at the first critical situation.

Organically complementing this trend is the fact that attracting capital to a Web3 project depends not only on technological advantages, but also on understanding the overall business logic. Investors look at profitability, industry outlook, and legal feasibility. While blockchain teams could hope for quick profits through a short speculative cycle until 2023, it's already clear that systemic products require full-blown corporate design. This means that anyone who wants to create a technological solution in the field of decentralized networks must have a plan in advance for regular interaction with regulators and transparent reporting.

Formation of a corporate structure to minimize risks and protect parties

The organization of management and control mechanisms within a startup is a key condition for attracting financial resources. Investors want to understand that the team has not only an idea, but also a well-thought-out blockchain business structure, including the distribution of authority, a decision-making system, and asset management regulations. Practice shows that even the most brilliant projects can lose their investment appeal if they lack a clear corporate model. Such an approach to the formation of internal processes makes it possible to avoid conflicts and increase the trust of the parties.

Most often, founders focus on the technical development of the product, missing the legal aspects. However, legal protection in cryptoprojects is necessary at all stages of the life cycle: from the moment of laying the foundation (creation of a protocol, formation of tokenomics) to the stage of scaling up to international markets. In this case, the key document is the shareholder agreement or token agreement, which describes the voting procedure, changes in the composition of founders, distribution of future dividends and other important details. In order to prevent abuse, investors often require a special clause on the vesting of founders' shares to be included in the agreement.

The risk of one of the founders leaving with a large stake of tokens is solved by legal reservation: so-called legal vesting. This means that the share of the key employee is released gradually over an agreed period, and in case of early departure, a part of the tokens is returned to the common pool. At the same time, there is a drag-along and tag-along mechanism that allows investors to influence control and prevent a situation in which minority shareholders block the sale of the company or make it impossible to exit the project if the majority wishes. Such measures are often included in corporate documentation at the request of large funds seeking transparency.

When choosing a structure, it is also important to keep in mind the issues of token storage and intellectual property. Excessive authority in one legal entity can lead to serious risks for the entire project. For this reason, several companies are often created: one company manages IP, the second one manages operations, and the third one keeps control over tokens. At the same time, investors appreciate the systematic approach, when strategic approaches to obtaining capital in crypto projects coincide with the practice of dividing responsibility between different entities. This reduces the likelihood that one shareholder can paralyze the project or take a dominant position by infringing on the interests of others.

A serious investor, before investing in an initiative, studies the requirements for investing in crypto projects and looks at how much the team knows about the legal mechanisms. If he sees gaps, he concludes that corporate risks are extremely high. Therefore, documented agreements and a clear ownership scheme are important for successful development. Separate attention should be paid to conflicts that may arise in the event of a change of management. Many funds stipulate in investment agreements mandatory notification of investors and agreement with them on the candidacy of the new CEO.

All this adds up to a single complex of investment preparation for crypto-business: the more detailed the founders think through the internal structure, the higher the probability of attracting long-term investments. This can only be achieved through the joint efforts of lawyers, financial advisors, and the team itself, which knows the technological side. No aspect should be left “behind the scenes”, as a transparent legal and organizational plan is the foundation of trust in a startup.

Example of key elements of corporate structure that mitigate risk and protect parties:

1. Shareholders' Agreement with drag-along, tag-along, ROFR (right of first refusal) clauses.
2. Legal vesting - step-by-step release of founder shares.
3. A holding company that owns tokens and an operating company that conducts the core business.
4. Foundation or special structure for DAO, if the project is decentralized.

Conclusion: The proper organization of project management, control mechanisms and legal arrangements provides the trust necessary to attract large investments. Any disruption in this system can lead to slow development or complete closure. That is why corporate construction and legal protection should be a priority for anyone planning to enter the decentralized technology market.

Legal model of tokens: classification, risks and legal elaboration

The essence of a blockchain project is often the launch of a digital token that fulfills a certain function in the ecosystem. Preparing a crypto project to raise capital involves a thorough analysis of the legal status of the token. A number of jurisdictions differ in their approach to determining whether it is a security token (a security) or a utility token (giving access to a product). Misclassification can lead to investors facing regulatory complaints and the project itself being forced to change documents retroactively. This is especially true for the US market, the European Union and a number of Asian countries, where there is clear legislation on digital assets.

Abroad, the question of whether a company violates the rules of issuing securities is taken most seriously. If the token actually involves profiting from the general operations of the company, it may be necessary to register it as a security. In such a case, the tactics of effective financing of a cryptocompany should take into account all the requirements of regulators (for example, in the U.S. it is the SEC). For projects seeking to avoid the complexity of working with securities, there is an option to position the asset as a utility. However, this way is possible only if the token really serves as a means of access to the functionality of the platform and does not promise a fixed return. This aspect should be carefully specified in the legal documentation.

Recognition of a utility token gives the project an advantage. It simplifies the process of listing on exchanges and reduces the number of requirements related to financial disclosure, but investors want to understand why it is not a security. It is important to exclude mentions of potential profits, dividends or rate growth so as not to mislead regulators. Many projects disclaim promises of direct returns in their official documentation. That is why Whitepaper often uses language about the functional purpose of the token, and also indicates the risks associated with price fluctuations.

The very structure of the token presentation in the documentation is also important. If the words “ROI” or “dividend” are present in the description, it immediately arouses increased interest on the part of regulators. Therefore, a competent legal formulation of Whitepaper is not only to explain the technical functionality, but also to refuse direct promises of financial benefits when investing Web3-project. It should be remembered that even with utility token status, a utility token may be classified as security in some jurisdictions if special rules apply there. Thus, every company must research the laws of the country where it plans to raise funds and consult with local lawyers.

Main elements of documentation related to the lawful model of the token:

1. Description of the asset's function (access to services, payment of fees, participation in voting).
2. Analysis of factors that may indirectly indicate the investment nature.
3. Assertion that the project does not guarantee profits and explanation of the risks.
4. Lawful opinion from a law firm with experience in digital assets.

Thus, tips for successful blockchain project financing suggest that the earlier the team decides on the form of the token, the easier it will be for them to interact with potential investors and regulators. A well-designed model reduces the risk that a nascent firm will be found to have violated securities laws after launch. That's why recommendations for financial support of a digital startup include early classification and appropriate preparation of all documentation.

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Development of internal policies and regulations in the cryptoproject

Global attention from supervisory authorities is one of the most important trends of this year, which forms the requirements for comprehensive preparation for blockchain project financing. Investors, banks and exchanges expect a new nascent firm to demonstrate not only technical innovation, but also a well-thought-out governance system. This means internal policies, regulations and rules governing how the team interacts with users, protects their data and controls financial flows. Without such a structure, a project's reputation is likely to be jeopardized and potential partners may refuse to cooperate.

One of the first documents that investors check is the AML policy for a crypto project. This document describes the mechanism for countering dubious transactions and confirms that the team monitors the origin of funds coming to the platform. A bank or a serious cryptocurrency exchange may request a copy of this policy even before opening an account or listing a token. It is important for the legal protection of the team and the preservation of goodwill that this policy complies with generally accepted standards and takes into account international financial monitoring requirements.

The second important component is a crypto startup's KYC, which involves identifying the client and verifying its status. Without this system, a startup may face restrictions when working with institutional investors and may not be able to list on major platforms. Proper storage and protection of personal data play a special role, as Europe has GDPR and other regions have their own privacy laws. This emphasizes the importance of data protection policies for crypto businesses, whereby the team must ensure that customer information is not compromised.

Token sales and distribution of digital assets within a project should also be based on internal regulations. Developing a Token Distribution Policy or similar rules governs when and how tokens will be released, who gets access to them in the initial round, and how the project intends to handle outage or emergency situations. Additionally, if the plan is to base a crypto startup overseas and launch a DAO, a separate document describing Governance Rules may be required. This is crucial for projects seeking to implement decentralized voting.

List of typical internal policies required for a blockchain project:

1. KYC/AML Policy - description of identification procedures and measures to prevent suspicious transactions.
2. Data Protection Policy (GDPR/PDPA) - regulating the methods of collecting, storing and processing personal data.
3. Token Distribution Policy - rules for issuing and distributing tokens, including issuance mechanisms, limits and timeframes.
4. Governance Rules - formalized decision-making system, especially in the presence of a DAO.
5. Whistleblower Policy - a mechanism to protect participants who report wrongdoing within the project.

Documents must be legally enforceable, i.e. formally approved by management. This is why it is not uncommon to use external expertise from lawyers who specialize in developing internal policies for a blockchain company. If all these aspects are worked out before the first meeting with investors, the chances of a positive decision will increase significantly.

Legal mechanisms to protect investors' interests in blockchain projects

In addition to internal structure and policies, it is important for investors to see what security measures are in place for the invested funds. Over the past few years, the most common early-stage funding tool has been the SAFT (Simple Agreement for Future Tokens), which operates similarly to the SAFE, but is tied to the future issuance of digital assets. However, teams wishing to maximize lawful protection when investing in a blockchain project should remember that SAFT alone does not solve all problems. The document should contain sections describing vesting, guarantees of return of funds under certain conditions, and the procedure for investor participation in management.

Sometimes the question arises as to how to secure funding for a Web startup without too much risk for the contributors. In such cases, an escrow agreement is used, where the money raised is kept in a third-party account and transferred to the developers only when certain milestones are reached. Investors often ask for an anti-dilution clause, which protects their share from severe dilution in new rounds. If the project is planning to expand, such a clause will seem to investors as an additional plus and a sign that their interests are being taken seriously.

For further successful implementation, especially if large-scale financing or repeated rounds are required, the correct formalization of legal relations plays a role. Best practices in blockchain financial planning include pre-designed investor protection mechanisms and clear agreements on how to handle non-standard situations. For example, if the founders decide that market conditions do not allow them to achieve planned metrics on time, they can change the structure of the transaction or offer investors a reorganization of token ownership.

Key legal instruments that build investor confidence:

• SAFT or SAFE with prescribed vesting, return and issue control terms.
• Escrow agreement and multi-signature to hold funds.
• Anti-dilution clause, protection against dilution.
• Voting and governance provisions (investor share in key decisions).
• Liability sharing rules if the project fails to achieve the target indicators.

All these provisions are combined in a contract, which becomes a basic guarantee of peace of mind for the depositor. Also, when considering a request for participation in a project, it is useful to mention that the nascent firm applies fundraising guidelines for a blockchain project focused on transparency and compliance. Legal mechanisms are a framework to increase the chances of a favorable development.

Investment rounds: from closed private placement to public token offerings

Modern practice shows that investment rounds in crypto projects can be more multi-stage than classic rounds in the IT sphere. For example, some teams conduct private sales even before the official announcement to form an initial pool of supporters. This is followed by seed rounds, strategic rounds and, finally, an open token sale or IEO/IDO. Each of these stages requires legally formalized agreements, including the introduction of KYC/AML procedures for participants. Without this, you can't go public on exchanges or offer a token to the general public.

When it comes to public funding for a blockchain project, it means that the project is selling its tokens to an unspecified number of people. Such an action is already often equated to a public offering, requiring appropriate approval in some jurisdictions. It is important for investors to understand that the team is complying with rules protecting retail investors and providing honest risk information. Sometimes such events are accompanied by regulatory involvement to verify that the documents are correct and that there are restrictions on unqualified users.

In parallel, there is a continuing trend to raise capital in Web3 projects designed for decentralized technologies. IDO - token placement on decentralized exchanges - is increasingly used here. But even in such cases it is necessary to take into account the requirements of local regulations. Some jurisdictions have already introduced laws regulating the activities of decentralized platforms, so you can't rely on the myth of “anonymity and lack of control”. The project team must comply with certain regulations, sometimes including licensing procedures.

Stages of investment rounds and their legal peculiarities:

1. Private Sale: closed placement to a trusted circle of persons; here there are higher requirements for NDA compliance and verification of investor status.
2. Seed: early stage with a small amount of fundraising where most investors are business angels or friends and family; usually underwritten by SAFT/SAFE.
3. Strategic Round: focused on funds willing to contribute significant amounts; requires more due diligence and firm guaranteed terms.
4. Public Sale (ICO/IEO/IDO): mass offering, involving working with retail investors, listing on exchanges and detailed KYC/AML procedures.

In each specific case, it is important to provide legal support for raising capital for a blockchain project, which guarantees the correctness of offers and protection of the parties. Regardless of the type of round, the investor always assesses whether the project has developed mechanisms to prevent legal risks and is ready to protect the invested assets.

Set of documentation for attracting blockchain project investments

Any team wishing to secure the support of serious funds in 2025 must have a fully prepared set of legal documents. The absence of one of the key items makes the investor doubt the competence of the project, and often the deal will not go through. The list of documents may vary, but in essence, all elements are reduced to a universal set. For example, many nascent firms forget to execute the documents for financing a crypto project correctly and on time, believing that this is a minor factor. However, a check shows the opposite: lawful transparency is sometimes more important than technical genius.

First, an investor needs founding documents. They confirm the legality of the company and record the decision-making procedure. Second, a Pitch Deck is presented, complete with a legal section describing the blockchain company's investment memorandum:

• ownership structure;
• tokenomics scheme;
• development roadmap.

The Whitepaper document should also include disclaimers indicating that the team is aware of the risks and is not misleading potential investors about earnings. Additionally, it is useful to have a draft or prototype token agreement reflecting the rights and obligations of the parties in the issuance and transfer of tokens.

The third important block is the shareholder agreement or investment agreement, which describes the terms of investor entry, principles of profit distribution and mechanisms for resolving disputes. If the project includes a DAO, a separate section on the principles of decentralized management is added. At the same time, legal support for raising capital for a blockchain project often includes preparation of AML/KYC procedures. Without formalization, these aspects can become a serious obstacle to opening a bank account or listing on a crypto exchange.

It is important that all documents are harmonized with each other and do not contradict the current legislation of the chosen jurisdiction. This means that the Whitepaper, investment agreement, corporate charters and legal opinion must be based on uniform definitions and comply with local rules. Otherwise, any inconsistency becomes a reason for rejection or for reviewing the transaction at the due diligence stage.

Standard package of documentation required to raise funding for a blockchain project:

1. Founding documents of the company (Certificate of Incorporation, Articles of Association).
2. Pitch Deck with legal section (description of ownership structure, tokenomics, Roadmap).
3. Whitepaper with detailed project description and correct disclaimer of revenue promises.
4. Investment agreement or SAFT/SAFE (with vesting and protection mechanisms).
5. AML/KYC policies (to verify depositors).
6. Legal opinion (confirming the token's status from a legal point of view).

​​The presence of all this complex shows the investor the seriousness of the team's intentions and readiness for long-term development. Practice confirms that the more complete the legal schema, the higher the chance of financing a digital startup.

Cryptoproject financing strategies: sources of capital

In addition to choosing a form of tokenization and preparing the necessary documentation, a project needs to understand what sources of investment for crypto projects are available in the market. Funds, crowdfunding platforms and gas pedals of different sizes and specializations can offer unique opportunities, but each of them requires careful legal documentation. The most successful team is the one that chooses the best combination of sources, considering both the benefits and the risks.

Many blockchain initiatives opt for Grants (grant funding for a blockchain project) provided by large protocols or foundations interested in ecosystem development. This solution usually does not involve giving away a stake in the company, but requires strict reporting of expenses and meeting deadlines. Angel investors (business angels) often enter at the earliest stage, agree to increased risk, but in case of success expect high returns. However, care must be taken to ensure that the lawful status of their contribution is correctly formalized, as this may affect the structure of the company in the future.

The next level is Accelerators/Incubators, which offer not only money, but also mentoring support when investing in a cryptocurrency project, access to networking and legal expertise. For a nascent firm, this is a way to quickly fill competency gaps and set up business processes. However, in return, gas pedals may demand a certain share or rights to tokens. Therefore, it is necessary to agree on all conditions in advance, excluding conflict situations. Serious VC-funds (venture capital to finance a blockchain project) are more prone to high injections, but at the same time they want to receive large guarantees, as well as a seat on the board of directors or supervisory body.

A separate layer is Crowdfunding/IDO, where a project receives funds from a large number of small investors, usually as part of a public tokensale. Despite the lack of large commitments to a single majority investor, legal complexity increases here, as the rules of mass placement must be followed. It is not uncommon for regulators to file claims against such campaigns, seeing them as a violation of public offering norms. That is why it is worth analyzing the requirements of the chosen country or site at the planning stage.

Considering the different opportunities, the stages of crypto startup funding are formed based on strategy. Some start with grants, some go straight to business angels or VCs, and there are crowdfunding teams. In any case, it is important to have an understanding of the specifics of each approach and to build the work in such a way as to comply with local legislation. The sources of investment in a blockchain project are diverse, but the legal nuances are also serious. Therefore, the right combination of fundraising methods can give a project flexibility without violating legal norms.

Preparing a blockchain project for lawful due diligence by an investor

Professional investors always organize due diligence before investing large sums in a startup. Tips for successful blockchain project financing suggest that decentralized specifics do not override the general rules of due diligence. Attention to the issue of the company's legal status and licenses is no less than in traditional IT business. The more detailed a nascent firm is ready for such a check, the more favorable financing terms it can get. Conversely, lack of transparency or dubious aspects in documentation lead to deal breakdowns at late stages of negotiations.

One of the first steps an investor takes is a lawful audit of the crypto project, which includes checking the ownership structure, articles of association, corporate agreements, IP rights, etc. If the company claims that its token is not a security, the fund's specialists look to see if this is true in fact. If discrepancies are identified, the investor can request correction of the documents or refuse the transaction. Therefore, before entering the market, authors should make sure that all the information in the documents coincides with the real state of affairs.

Investment due diligence of blockchain businesses is also taken into account, which is related to technical features: they look at whether the code is protected, whether data confidentiality is respected, and whether patents are not violated. In some cases, highly specialized experts are required to audit smart contracts. Relationships with top management, the structure of shareholdings, and the presence of vesting are also examined. All “verbal agreements” without formal formalization are considered potentially dangerous for investors.

Criteria for legal due diligence of a crypto nascent firm that investors pay attention to:

• Registered legal form, availability of licenses if necessary.
• Official confirmation of rights to code, domain and brand.
• Token status (utility/security), availability of Legal opinion.
• Financial accounting, no debts or unauthorized transactions.
• Specific corporate agreements and governance policies (including vesting, conflict resolution mechanisms).

The clearer a nascent firm is, the easier it is for it to make the round and get optimal financing terms for the realization of the crypto project. From this we can conclude that successful due diligence is not only a matter of ethics, but also a step towards lowering the cost of raising funds, as the investor sees low risks and asks for a lower premium. In a competitive decentralized technology market, this can be a key advantage.

Choosing a jurisdiction to raise funding for a crypto project

When planning to register a blockchain project abroad, a startup faces a wide range of lawful systems. The country of registration determines whether the project will be able to access global capital, how the token will be classified, and what tax benefits can be counted on. Today, jurisdictions for launching a crypto project with transparent regulation are becoming more and more in demand: this eliminates a number of questions from partners. However, the choice in favor of “crypto-friendly” countries has a downside - higher support costs and stringent information disclosure requirements.

Among the most popular destinations are Switzerland (Kanton Zug), where blockchain companies often work in the format of a foundation, Singapore, which provides a simplified tax regime, as well as the BVI (British Virgin Islands) and the Caymans, which are focused on holding structures. The UAE is becoming an attractive option due to its special zones with favorable treatment for digital companies. Large funds are increasingly avoiding overly exotic offshore locations, preferring stability and predictable regulations.

Special attention is paid to the possibility of obtaining a VASP (Virtual Asset Service Provider) license. In a number of countries this is a mandatory requirement for companies dealing with cryptocurrencies, tokens. In Singapore, this licensing format is controlled by MAS (Monetary Authority of Singapore). Regulation of crypto startups in the UAE is becoming increasingly serious: companies need to get approval, confirm corporate procedures and often have a physical presence in the region. As a result, there is a growing number of projects that are opening offices in multiple locations around the world, trying to optimize residency in different countries.

For some projects, the best solution may be to register a blockchain company in Singapore and, in parallel, set up an offshore entity in the Caymans to hold tokens. Such a scheme looks complicated, but allows for flexible asset allocation. At the same time, the advantages of offshore when launching and funding a blockchain project are undeniable: minimal taxation, simplified accounting regime and asset protection. However, investors will assess the reputational side of the issue, as not everyone is ready to finance a startup from an offshore blacklist.

Taking all this into account, it is worth comparing several key indicators to understand which country will be optimal. Below is a conditional table with an approximate comparison of popular jurisdictions for registering crypto projects.

Table of main jurisdictions for blockchain projects

Any choice requires a comprehensive analysis. When deciding on a country to register a cryptocurrency company and further finance a blockchain project, the following parameters are weighed: cost of service, protection of intellectual property rights, ease of reporting, access to banks and stock exchanges. Some teams change jurisdictions after the first investment round if they realize that another option will be more profitable. However, this involves additional costs and time. Therefore, it is important to determine the strategic focus right away, taking into account all legal nuances.

Conclusion

Forming a long-term investment strategy for a blockchain business requires a comprehensive approach. All stages must be properly considered, from choosing a legal form and working out tokenomics to preparing internal documentation and complying with regulatory requirements. The more transparent and well-thought-out the lawful architecture is, the easier it will be for a nascent firm to get the support of large funds and attract users. Currently, the competitive environment is getting tougher, so the only reliable basis is compliance with applicable laws, correct classification of tokens and a high-quality corporate structure. This will allow structuring the financing of a crypto project so that it not only succeeds in the short term, but also remains relevant for many years.

Our company offers consulting support for crypto startups within the framework of crowdfunding or private-sale campaigns, supporting projects at all stages of development: from choosing a jurisdiction and preparing internal policies to obtaining licenses and drafting investment agreements. A team of experienced consultants is able to adapt solutions to the rules of each country, minimizing risks and increasing the attractiveness of the startup for sponsors. All of the above tips on successful blockchain project financing and other recommendations are reflected in real cases, which confirms the effectiveness of our systematic approach. Integrating legal expertise with business strategy helps founders build reliable investor relations and create a foundation for sustainable growth. As a result, preparing a crypto project for investment becomes systematic and consistent, which is especially valuable against the backdrop of global competition and rapidly changing regulatory requirements. Without such support, the likelihood of encountering serious problems increases, and many promising ideas never make it to a full-scale commercial launch.