Douglas Park on Regulations and Lessons from Advising Crypto Startups

Our interview with Douglas Park is here! (iTunes, Google Play, and Stitcher) Doug is an astute cryptocurrency and blockchain lawyer, advisor, and former business school professor.

Highlights below:

What Were You Doing Before Blockchain?

How Are You Actively Advising Blockchain Clients?

What Are Some Risks or Challenges That Your Clients Face?

How Do You Deal With Questions Around Utility Token vs. Security Token? Does That Regulatory Hurdle Impact Businesses?

Also, remember folks are scrutinizing things coming out of the SEC to get guidance and clarity. But those remarks reflect his personal opinion, not necessarily formal guidance of the SEC. It’s a complicated legal issue. With clients, I try to avoid the hype and noise, so I can walk through the legal analysis of reducing their risks.

What Kind of Effect Does This Have on Startups Wanting to do Token Sales?

The SEC is most concerned with taking actions against fraud and egregious behavior. Of the enforcement actions the SEC has taken against companies that launched token sales, almost all of them involves securities fraud. During the marketing and promotion of the token sale, the companies misrepresented or ‘flat out lied’ about their business. One company claimed to have partnerships with many banks. The SEC forced this company to return the funds to investors, and worked with the Department of Justice to bring criminal charges.

What Kind of Things Can Happen to Companies Who Are Non-Compliant in This Changing Landscape?

How Do You Help Blockchain Startups to Increase Their Chances of Success?

What’s the Outlook on Regulations and the Crypto Landscape?

There are benefits to issuing security tokens over traditional equity. Security tokens offer investors direct economic benefits, such as dividends or revenue share, on top of liquidity. But the major barrier has been liquidity. It’s hard to trade securities tokens. So by the end of 2018 or early 2019, when exchanges allow security tokens to be traded, this could really change the landscape.

Links:

twitter.com/DougYPark

Credits:

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Podcast: iTunes, Google Play, Stitcher

A Bit Cryptic tries to inspire, educate, and elucidate about the world of cryptocurrency and blockchain technology. Created by Jeff and Rob Peterson & Dang Du.

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