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Interesting idea. I didn't dig into how App Coins work and how allocation of revenue works. But my instinct is that it could very easily implicate state and f
by cfield 12y ago
Interesting idea. I didn't dig into how App Coins work and how allocation of revenue works. But my instinct is that it could very easily implicate state and federal securities laws.
- bitsweet 12y agoThanks cfield! I appreciate your perspective on this and we've spent a lot of time getting the legal structure right. The App Coins are a way of determining royalty payouts for now. The only way to earn them is by participating in building the product, and effectively joining the product's partnership. This would be similar to how a law firm partnership is structured and is why these are not securities. Assembly App Coins can't be purchased by outside investors and Assembly App Coins can't be transferred to other individuals not in the "partnership".
- cfield 12y agoWith securities laws, substance often trumps form and much ink has been spilled on what constitutes a security. Even a partnership interest can be a security (often turning, in part, on how much real control a partner has). I have no doubt it is possible to design a system that navigates the treacherous landscape of the securities laws, and perhaps you have done that. I just note that securities laws are one of the design constraints you'll need to account for. It sounds like you've made an effort to do that. I would certainly encourage you to get some expert help in this area when it’s the right time to make that investment. Good luck!