Anonymous asked Legal & Compliance, LLC , 6/26/2018 ( 1 comment )

What are some key factors to consider before implementing a DLT or Blockchain to one's business?

Legal & Compliance, LLC replied:

Concerns related to securities laws are different than the business concerns associated with making technological changes.  If your business is not considering an offering or issuance of tokens or coins for fundraising, then you should focus on the technology.  However, if you are considering issuing a token then you should consult with securities counsel.  Some of the questions that you should be prepared to answer, include:

1. Is the token creation commensurate with meeting the needs of users, or rather, for investment or speculation?

2.  Are independent actors setting the price or is the promoter supporting the secondary market for the token or otherwise influencing trading?

3.  Is the primary motivation for purchasing the token for personal use on the network, or for investment or speculation? 

4.  Are the tokens distributed in ways that meet the user's needs.  For example, are they issued and held in increments that align with use on the network.  

5.  Do the tokens degrade in value over time if not used?

6.  Will the tokens be sold to the general public or only potential users of the network?

7.  Is the network fully functional or still under development?