Business Partner Disputes – What Are Your Rights?
Business partner disputes are normal. But what happens when you believe your business partner has engaged in wrongdoing? What are your rights and what can be done about it? I’m an attorney first and foremost, but I’m also a business owner. I served as general counsel for two startups, and am an investor in several…
Investor Class Actions – Get More By Opting Out?
In this blog post, I will discuss some potential benefits of “opting-out” of investor class actions. Bottom line: large investors often achieve better results by bringing their own case. How Do Investor Class Actions Work? In a typical shareholder lawsuit, an institutional plaintiff is appointed to represent an entire class of similarly situated investors. The lawyers…
Are 51% Attacks Illegal?
51% Attacks Are Illegal Under the CFAA Applying traditional legal concepts to blockchain technologies can be tricky business. For example, if a blockchain project needs legal advice, who is the client? If a blockchain network breaks the law, who is at fault? In this blog post, I will discuss whether 51% attacks are illegal. If…
Are Crypto Exchanges Providing Best Price?
Are crypto exchanges providing the best price? How often have you traded on one crypto exchange, only to see a wildly divergent price somewhere else? I know many traders feel compelled to monitor several crypto “exchanges” simultaneously to ensure their trades are reasonably priced. I also know a few traders who use price differentials as…
Best Practices for Cryptocurrency Exchanges
Here it comes – the cryptocurrency exchanges are now under scrutiny. Last year, regulators in the United States were firmly focused on the mechanics and fairness of Initial Coin Offerings (ICOs). By now it seems settled that ICOs need to comply with the federal securities laws. So now it is time for cryptocurrency exchanges to…
tZERO’s Security Token Offering (STO) Unpacked
tZERO is conducting the first major Security Token Offering (STO). tZERO, like Polymath, is positioning itself as a leader in the movement to transition securities like stocks and bonds to the blockchain. tZERO’s niche in this space is trading. It owns controlling interests in broker-dealers, SEC registered trading platforms, and even an investment advisor. Picture Schwab, but all…
Token Airdrops May Technically Be Unregistered Sales of Securities
It has been all the rage lately for blockchain startups to do a token airdrop instead of an initial coin offering (ICO). Now that the SEC has made clear that ICOs are securities offerings, everyone is trying to find a workaround. Why? Because crypto has democratized investment opportunity. The notion that ground floor investment opportunities should…
Bitconnect – Why Crypto Needs Regulation
The Bitconnect scam is a good example of why crypto investors should not fear regulation. If you haven’t heard of the recently-shuttered cryptocurrency platform, it had all the hallmarks of a Ponzi scheme. Despite blaring warnings from the internet writ-large, investors chased after too-good-to-be-true returns and lost nearly everything. The Bitconnect Scam Bitconnect described itself as…
Whistleblower Awards From Cryptocurrency Pump and Dump Schemes
So it looks like the Commodities Futures Trading Commission (CFTC) is taking a hard look at cryptocurrency pump and dump schemes. And its offering awards to whistleblowers of 10 to 30 percent. That’s good, because manipulation has always been one of my chief concerns about crypto markets. Consider that market manipulation is generally illegal in…
The ICO Is Dead – The Securities Token Offering Is Next
2017 was the year of the Initial Coin Offering or “ICO”. I believe 2018 will be the year of the Security Token Offering or “STO”. What does this even mean, and why should you care? THE ICO’s LATENT DEFECT – ITS A SECURITIES OFFERING Prior to 2017, the ICO was rare. There was the Ethereum…
Polymath Security Tokens – The Future of Crypto
This is going to sound like a bold claim: Polymath is the biggest thing in crypto. I know, everyone seems to be focused on the “next bitcoin” or “next ethereum.” And Polymath is not it. So why is Polymath such a big deal? Because it aims to put the stock market on the block chain….
An Everyday Example of Trade Secret Theft
Trade secret theft is everywhere. Competitors are always trying to get (unfair) advantage over the competition. Here’s how it happens. The Backdrop A few months ago, I utilized a service that is part of the sharing economy. You know, a service where you order something from an app, then a driver brings it to you….
Can the SEC Measure Whether Cryptocurrencies like Bitcoin Are Securities?
I’ve been studying cryptocurrencies and blockchain with considerable interest for some time now. As a lawyer, one of my favorite intellectual exercises is comparing new phenomena to existing legal standards. A. ARE BLOCKCHAIN ASSETS SECURITIES? While the world continues to incorporate and adapt to the emergence of blockchain technologies, there is much regulatory uncertainty in…