Regulatory Migration to Europe: ICO Reallocation Following U.S. Securities Enforcement

Krishna Sharma, Khemraj Bhatt and Indra Giri

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Abstract: This paper examines whether a major U.S. regulatory clarification coincided with cross-border spillovers in crypto-asset entrepreneurial finance. We study the Securities and Exchange Commission's July 2017 DAO Report, which clarified the application of U.S. securities law to many initial coin offerings, and analyze how global issuance activity adjusted across regions. Using a comprehensive global dataset of ICOs from 2014 to 2021, we construct a region-month panel and evaluate issuance dynamics around the announcement. We document a substantial and persistent reallocation of ICO activity toward Europe following the DAO Report. In panel regressions with region and month fixed effects, Europe experiences an average post-2017 increase of approximately 14 additional ICOs per region-month relative to other regions, net of global market cycles. The results are consistent with cross-border regulatory spillovers in highly mobile digital-asset markets.

Date: 2026-01
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