Incentivized Testnet Legal & Tax Requirements
KYC/AML
As a public permissionless chain, anyone can become a validator node on Regen Ledger. That said, if you want to receive $REGEN — our native token — in compensation for participating in the testnet, we are legally required to have you first go through our “Know-Your-Customer/Anti-Money-Laundering” procedures.
Step 1: KYC Form
If you are a US Person, fill out this Google Form to express interest in your participation, which will provide us with the necessary information to start our KYC requirements.
If you are a non-US person, fill out with Google Form to express interest in your participation, which will provide us with the necessary information to start our KYC requirements.
Step 2: Submission of KYC Documents
After completing the form, please send us a copy of your passport or other ID, along with proof of address, and a photo of you holding both of these documents. See a full list of documentation requirements here.
We will run your information through a KYC/AML screening via World-Check One to insure that you haven’t been convicted of terrorism, aren’t operating out of a sanctioned country, etc. If you aren’t, we proceed to the next step.
Another aspect of our KYC process is to make sure that validators earn rewards for their hard work. By linking a public key and regen ledger address to your identity, we ensure we can compensate you for your participation. Key pairs and addresses are durable across networks. This means that they can be reused. For further details about key and address generation check out our docs.
Step 3: Tax Documentation
In receiving $REGEN as a testnet reward, you may be liable for income tax here in the United States (and/or in your own country).
As a corporation, we need to collect the tax information for anyone to whom we issue tokens in excess of $600. As the average testnet payout will be significantly higher than that, and as we won’t know the exact value until right before mainnet, we need to collect tax documentation on all testnet participants in advance of mainnet.
If you are a US person, you must complete and return a W-9 to us. If you an a non-US individual, you must do the same with a W-8BEN instead. And if you are a non-US legal entity, you must complete a W-8BEN-E (you’ll notice that this latter form is significantly more complex than the standard W-8BEN, and may have a preference to register your tax status with us an individual because of this).
Step 4: Securities Exemption Type
We determine which type of agreement we are entering into. There are two types of agreements that allow us to offer $REGEN tokens in a legally compliant way before the launch of our mainnet to contributors to the Testnet Process.
These two agreement types are listed below:
- If you are an US person, you will receive tokens via a Reg D exemption.
- If you are a non-US person, you can receive tokens via a Reg S exemption.
You may be wondering:
As a participant in a testnet, I’m not investing money into Regen Network, so why do I need to go through KYC/AML to receive tokens?
You will be receiving tokens through a modified Simple Agreement for Future Tokens (SAFT) optimized for contractors providing a service to the network. Although you’re not investing money, a transfer of $REGEN before mainnet launch is still considered a transfer of unregistered securities in the US context. Of course, after mainnet launch $REGEN is a staking token with the same attributes as ATOMs.
Step 5: Genesis
If you’ve done the KYC/tax process and participated in accumulating points, we will then do a final step to ensure your validator matches the identity you’ve provided. At this stage we will also provide you with the documentation for setting up a Regen-Ledger-compatible key set/wallet. This last step will be completed before we write your token allocation into the genesis file at main net launch. We are working out the details of this final step.
Deadline
All of these steps must be completed by Feb 15th, 2021 to be included in the genesis file for main net launch.
