A Registered Token Offering

Comments (Archived):

1. I think I’m getting old, because I don’t like the looks of those teenagers.

2. Sham and Shame – the regulation was designed to help small businesses raise money not VC funded companies set up LLCs to raise money for quasi securities.

3. Love it, this may be the first token offering I buy into. I love what Blockstack is doing (wish it were a UPENN company though), I expect to see a lot of legit companies do token given the SEC private letter ruling.

4. More info on this can also be found on a podcast episode Muneeb and Anthony Pompliano recorded last night and released this morning:https://open.spotify.com/ep…

5. Why a wholly-owned subsidiary?I hope it’s not an ‘A shares, B tokens’ gig. That would be unfortunate for the reputation of blockchain and venture capital.

6. Yup, but Reg A’s are expensive. I hope the cost goes down.

   1. happen to have a ballpark price estimate? Surely small compared to an IPO, right?

      1. Around 1M . Still, not chump change.

         1. wow, ok, actually not so small compared to IPO.maybe there’s a good thing about this, having a barrier to entry.

         2. BTW, it looks like their offering costs were $1.8M

            1. Yup. Sounds about right

   2. Feels like good news directionally regardless.

   3. Reg A+ doesn’t have to be expensive if you’ve got a repeatable process and common structure. These guys are doing them on $100K+ collectible cars. https://rallyrd.com/

   4. So a ‘big step forward’ happens, and the response is ‘that’s expensive.’ And nobody has ever done this before (or paid for it). Huh.Someone smart said to me recently: ‘I hate when the answer says it’s expensive when they don’t provide a comparison.’ I know folks are comparing this cost to regular IPOs, but that feels flawed. It misses the ‘this is now possible’ part of the math. And nobody I’m seeing is coming forth with ‘having done the math,’ they’re only reacting to others’ information (not bringing their own math).Blockstack executed this within (a week?) of the SEC making this possible, and folks on this thread are like ‘Harrumph, Sounds Expensive!’ (without knowing).Talk about passive-aggressive, Reg A+ Trolling (sheesh).

      1. There’s no math to do. The $1.8M cost is from the offering doc. That’s a ton of money for most early stage entities – especially when there is no guarantee it’s even going to get approved by the SEC. There are a number of tokenized Reg A offerings ahead of them, so we’ll find out in due time.But I’m not sure how ruminating over lower offering costs is trolling.(As an aside, the SEC didn’t do anything recently to make this possible. This could have been done 4 years ago.)

         1. Mea Culpa! ‘Trolling’ is a sensitive verb to use; my wordplay did not intend to offend. I apologize.

         2. They’re not using their own money, so it’s not really expensive – and they’re all trying to work towards building up the pyramid more and more.Likewise, there’s a reason there’s a certain cost and not closer to free – however the cryptocurrency community thrives on the idea of avoiding financial regulation – they seem hellbent on destabilizing these financial foundations that limits bad actors and helps stabilize democracy. They community by and large has already gotten away with extracting hundreds of millions from people not knowing any better because they misappropriate ICOs as having some real value associated with companies on the stock market – a clever but disgusting psychological trick – likewise misappropriating the term currency; this alone shows a lack of integrity in those perpetuating all of these Ponzi-Pyramid schemes.

      2. In the world of startups, this is new, and the price might not a shock to you, but it is to many others, hence my comment. Your “trolling” label is a bit extreme.

         1. Mea Culpa! ‘Trolling’ is a sensitive verb to use; my wordplay did not intend to offend. I apologize (ii).

            1. Accepted 😉

7. Great news.I too am a proud Stacks token holder, so of course I’ll say that and not much more, but this indeed interesting move should prove out (or not) some important things for the industry.

   1. As @jasonpwright:disqus asked elsewhere, what’s the value or reason for holding the token? He asked this in relation to this he pasted:”There is currently no authoritative literature under accounting principles generally accepted in the United States (U.S. GAAP) that specifically addresses the accounting for sales of cryptoassets like Stacks Tokens or simple agreements for future tokens pursuant to which Stacks Tokens would be issuable. Therefore, by analogy, Blockstack is recording the sale of the Stacks Tokens similar to the sale of contracts to perform software development services for customers under Accounting Standards Codification (ASC) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09). Blockstack has determined that the economic nature of the Stacks Tokens is most closely related to a customer contract because the network is the output of Blockstack’s ordinary activities and Blockstack views the parties that purchased tokens as having a stake in the development of the network and the promotion of the network’s use. In addition, even if token holders were determined not to meet the definition of a customer, Blockstack would analogize to ASC 606 for lack of any other guidance. Blockstack has determined that the Stacks Tokens do not represent securities for accounting purposes as they are not liabilities and do not entitle the holders to revenues, residual profits, or other returns of Blockstack or any other entity.”

      1. You hold the token because you believe that there will be demand for the service which runs on the token. However, representing that belief with a defensible value model is not something people seem to be that interested in. That’s a shame because the only remaining perspective is the bigger fools theory.

         1. The problem with demand is if I can make a competing service that doesn’t have (what I believe are) Ponzi-Pyramid scheme mechanics inherently built into cryptocurrencies, and therefore are cheaper especially because I’m not paying for the ridiculous energy use requirements, then it makes no sense. Yes there are some applications where blockchain shared privately with already trusted partners – legal, finance, health – to share information can have value, however you don’t need to structure them as a Ponzi-Pyramid scheme nor defend the network against any outsiders because you only allow already trusted partners into the system; I’m waiting to see someone to outline exactly all of these use cases for blockchain, and then also any use case using Ponzi-Pyramid scheme cryptocurrency structure services and show the difference in cost difference between using a tokenized system vs. using other technology that will not have the same inherent problems and added costs as cryptocurrencies; only vague references are ever made to one or two different projects, yet no depth is actually analyzed or discussed by the person defending the why.

            1. If you have trust, then you don’t need the massive overhead of a trustless system. So if it’s just about transacting between a set of trusted counterparties then use Hyperledger or Oracle or JP Coin or SWIFT or CICS or whatever. Your implementation will be soooo much easier.If you don’t have trust, then it’s a different and harder game that requires decentralization. And decentralization is a *huge* PIA that people will be trying to solve for the next decade(s).If you completely trust Wells Fargo, Facebook, Equifax, Maduro et al to do the right thing and are happy with the controls you have, then of course public blockchains are ridiculous. But there is a different narrative that has a lot of great ideas and smart people behind it. It may end up not being feasible or it may fundamentally reinvent industries… or somewhere in between. Give it some time.

            2. This is insane to argue this way: why would you want to interact or share money with people you don’t trust? Are you someone who’s okay dealing with the mob or mafia, bad actors, and so on?We don’t shouldn’t trust any of those by default: we need to be skeptical to have the same authorities and regulations and enforcers in place. We are failing, not completely though, at making the assholes accountable – only fining companies and not putting their executives in jail – most recently Deutsche Bank being accused of laundering $20 billion for bad actors in Russia; https://www.cnbc.com/2019/0…Now what you’re/others are wanting is to circumvent all of these mechanisms, and tie it into a Ponzi-Pyramid scheme to transfer wealth away from late adopters to early adopters. It’s unreasonable, absurd. The current mechanisms and systems need to be fixed and those lobbying and manipulating society and laws to benefit themselves with only relatively tiny fines vs. substantial jail time is the problem; these organizations need to be internally accountable every step and interaction for their decision making process – sure in a blockchain is fine among trusted organizations, legal and so on – so then when it turns out executives and certain people in a certain chain of command decided to launder $20B from Russians – we know EXACTLY who’s accountable and can throw them all in jail, and all of the proof and documentation will have had to have been embedded in the blockchain; this is closer and part of the solution, not public cryptocurrencies for greedy and gambling people, hype marketers, to take advantage of society.Curious what are your thoughts on this immutable chain of command decisions – immutable decisions record of chains of command?

            3. I urge you to try to think about 2021 instead of 2017, and perhaps think about ‘web3’ instead of ‘crypto’. There’s definitely a leap of faith to get past last year’s headlines, but once you dig into what the world could be operating on decentralized protocols and open data, it’s pretty mind-blowing. It’s not really (just) about getting rid of greedy bankers, but it’s opening up new applications in the same way that the internet expanded our world compared to AOL and CompuServe.Honestly, I don’t understand or want to understand how to “fix” corporate or government responsibility and accountability. I’d much rather build and grind away at an alternative model and rely on innovator’s dilemma to do its magic.

            4. Dude, I’m thinking way past 2021. I’ve been thinking about Web 3.0 for 20 years now, and more heavily since Fred’s blog post on The Independent Web – when those ideas were first making the rounds. Decentralization and open data can exist without blockchain – true or false?You sum up the ignorantly blissful attitude quite well – not willing to engage in actual critical thinking, yet happy to spout mystical/magical “if we trust it it will happen” propaganda.. It’s laughable that you don’t want to understanding how to fix corporate or government responsibility and accountability – you don’t want to understand the problems yet for a solution you’re apparently promoting to solve? And obviously you own Bitcoin or other cryptocurrencies, so you’re incentivized and biased – yes?

            5. If critical thinking is dwelling on transient, relatively trivial noise (energy, scams, money laundering) or hoping that extremely powerful, self-interested entities will start acting in humanity’s best interest because of the courts, then, yes, I’m ignorantly blissful. Not wanting to fix something I have no control over is quite different from not understanding the problem.I own bitcoin because I believe it will appreciate long-term. I agorithmically trade alt coins only very short-term because once we get through this high-speculation phase, I believe most of the tokens will go to zero-ish (even if the projects and their associated equity do well). I have a side project building a DAO platform for a vertical industry (which is actually quite centralized due to immaturity of decentralized services to build on).Honestly, I don’t quite know what you’re arguing for or against. Most of your gripes have emerging solutions (PoX models, STOs, KYC ,etc.) and they are dwarfed by the scale of problems with centralized/fiat systems.In any case, let’s let this thread die the death it deserves… you wear your bitcoin is a fraud hat and I’ll wear my rainbow unicorn t-shirt and let’s check back in later. 🙂

            6. That you call the points I brought up as trivial noise and dismissed them as dwelling just parrots your previous commentary, a similar practice of other pro-cryptocurrency holders – continuing avoidance of actually explaining the solutions to the base problems or loosely referencing ’emerging solutions.’Indeed it’s pointless to continue these discussions except to protect society by countering the hype of the army of HODLers all incentivized to push these Ponzi-Pyramid schemes to their limit; those who are best at this game of course amass more money, taking it from undereducated public not protected by existing financial regulation and markets which have failed those who have lost money in the ICOs mimicking IPOs – and so on.

8. The problem is that the SEC continues to drag its feet in qualifying any RegA+ offerings. RegA+ has enormous potential for the STO market in the US, but until the SEC actually qualifies one, we remain in limbo

9. Read about this earlier and gonna dig in.I think this is a good direction, good news and a step in the right direction.

   1. Would love to hear your thoughts and you dig in, Arnold. It reads pretty horrifying…https://www.sec.gov/Archive…

      1. K–Working with a number of accounts.Couple did ICOs, now raising venture.Other is closing venture, though will do a STO after a bit.I don’t need to be an expert in this but need to be very informed is all.Trust all is good with you my friend!

         1. Yeah, this one just feels like a 2017 era ICO wrapped in a 2019 STO. The good thing is that there is plenty of info in that doc and I expect someone will summarize some of the more obvious issues over the next couple days.I hope we’ll see more asset-backed STOs soon – maybe boring, but am worried people will get soured on STOs very quickly if they all look like this one.Things are fine… just 70% too few hours in a day.

      2. “There is currently no authoritative literature under accounting principles generally accepted in the United States (U.S. GAAP) that specifically addresses the accounting for sales of cryptoassets like Stacks Tokens or simple agreements for future tokens pursuant to which Stacks Tokens would be issuable. Therefore, by analogy, Blockstack is recording the sale of the Stacks Tokens similar to the sale of contracts to perform software development services for customers under Accounting Standards Codification (ASC) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09). Blockstack has determined that the economic nature of the Stacks Tokens is most closely related to a customer contract because the network is the output of Blockstack’s ordinary activities and Blockstack views the parties that purchased tokens as having a stake in the development of the network and the promotion of the network’s use. In addition, even if token holders were determined not to meet the definition of a customer, Blockstack would analogize to ASC 606 for lack of any other guidance. Blockstack has determined that the Stacks Tokens do not represent securities for accounting purposes as they are not liabilities and do not entitle the holders to revenues, residual profits, or other returns of Blockstack or any other entity.”What’s the reason to own the token?

         1. Well, this is the same problem that 99% of tokens have… no valuation methodologies apart from MV=PT arm waving that fails the sniff test almost every time. Nothing new there.Adding injury to insult, they have to pay income tax on the token sales… last year they spent $16 million on income tax and crypto speculation losses. Let’s see what happens with 2X the token revenue.

         2. I doubt you’ll get an answer from the company or Fred.

10. far too complicated, plus out of NYC which makes the whole thing feel like a scam. NYC, LDN – both the same. Built on financial capital when the future is social capital.

11. I have a lot of respect for this. To me, crypto is clearly a security. One can creatively justify why it might not be…but it is. And for someone to embrace that, to step up and to be the leader to take the plunge and file…much respect.Conversely…when will online & payday lenders finally be banned for predatory APR?

    1. the buy here pay here car lots as well.

12. Also – a quick and solid differentiator…”our cyrpto/currency is filed with the SEC”, suddenly creates a moat and a competitive advantage, especially when folks flock to safety after public markets crash.

13. Muneeb here from Blockstack. I want to mention that a lot of details can be found in the SEC filing which is linked from the blog post above, so please check that if you have questions. Also, here are some FAQs: https://docs.blockstack.org…