Impeccable lawyers signal trust and unparalleled quality
Accountants argue that paid legal fees are expenses. This is not always the case. Some legal fees are truly investments. From a token marketing perspective, investing in an impeccable lawyer may provide substantial returns.
A reputable lawyer may serve as a good statistic for legitimacy. Hiring one may show a healthy respect for government regulation and even concern for the welfare of token buyers. Furthermore, retaining irreproachable lawyers indicates a strong proclivity toward ethical behavior. They signal trustworthiness specifically and quality in general. That is because well-established, reputable lawyers not only require all clients to undergo exhaustive due diligence and background checks, but also refuse to work with token issuers that would be injurious to their reputations or credentials.
Impeccable lawyers have much at stake. It takes them years of schooling and punctilious practice to build an excellent reputation. Helping to draft misleading marketing documents will get a lawyer disbarred in the State of Washington, and perhaps every other jurisdiction. They would not only be unable to practice something that they supposedly love, but also forfeit a lucrative profession.
When it comes to token sales, the disincentives for aiding and abetting deception are material. The US Securities and Exchange Commission (SEC) made it clear that it will hunt down lawyers that are negligent or assisting clients to commit fraud. While it is not impossible to remain honest and ethical while serving dishonest and unethical clients, as may be required of public defenders for example, at some point it becomes very easy to cross the line when advising clients on their white papers, the cornerstone of all ICO marketing.
Although software developers and blockchain engineers would have everyone believe that the white paper is a technical document, the white paper becomes a marketing document the minute it is used in fundraising. That is because it is the primary document token buyers refer to when trying to establish the usefulness of a token or coin. This is now a tradition. Token marketers, or promoters/issuers, depend on a well-drafted white paper to assure token purchasers of the value of the tokens being sold and each token’s potential to appreciate in price.
With respect to utility tokens, these irreproachable lawyers would advise conservative marketing. For example, advise clients not to create any expectation of an appreciation in token value, upon the token’s listing on a cryptocurrency exchange, through any effort made by the promoter. Such counsel would ensure that the SEC does not issue a cease-and-desist order for promoting an unregistered security.
It might be tempting to think that the impeccable lawyer takes the fundraising power away from the promoter when they forbid illegal token marketing, however that would exhibit a lack of understanding that the brand name of the lawyer (or law firm) is the promoter’s new marketing credential. Instead of selling tokens under a weakened or tarnished brand, the promoter, once lacking legitimacy, is now camouflaged behind the brand of a respected law firm.
There is now a solid foundation upon which the issuer may build its campaign to persuade token buyers. Thanks to the lawyer, token buyers feel free to investigate the apparently legitimate claims of the white paper. The burden of due diligence has been borne by the lawyer. It is as if the lawyer certified the token sale.
Instead of deploying boil-the-ocean marketing campaigns via Google, Facebook and other social media channels, concept-stage ICOs should focus on identifying and retaining an impeccable lawyer. Retaining reputable legal counsel may come at a steep price to the fledgling venture. However, it may be worth it if the fundraiser is able to cultivate a little faith in the potential value of the token and foment speculation. Having then effectively covered the most essential of token marketing activities, the inexperienced, or illegitimate-appearing team, is able to turn to the other two critical token marketing activities: identifying inventories of rent-seeking cryptocurrency and constantly assuring an abundance of satisfied token holders.
This article is a continuation of The Most Crucial Step In Successful Token Marketing. The articles were written to help fundraising teams that have an injuriously poor public image or low credibility. Many firms must eventually do battle with negative perceptions. Think of Facebook and Cambridge Analytica. Some firms are considered scandalous or fraudulent in the court of public opinion exactly at the time they are trying to raise funds for their initial coin offering. They should have no fear of reaching their fundraising target if they are issuing a legitimate token, writing thoroughly-audited smart contracts, and following the lead of irreproachable legal counsel.
The most crucial step in successful token marketing will be different if you have a reputable and highly credentialed team. In such cases, it is advisable to be endorsed by a highly successful hedge fund, investment bank or venture capital firm.
Please consult an accountant and expense paid legal fees unless advised otherwise.
Useful Coin provides market research and business strategy services. In this Medium Publication, Useful Coin shares research into cryptocurrencies, cryptocurrency-based fundraising, and financial services delivered over peer-to-peer network technologies performed for clients in South Korea, the Cayman Islands, Jamaica, and the United States of America.