Bitshares and LLC

[wesphily]

Does bitshares have a "trust" or "escrow" capability? This is key to try to make the LLC as trustless as possible. I want investor funds held in a trust/escrow so that they are only released upon certain conditions.

Also, I may have figured out a way to use bitshares for the LLC. I'll share more details once I meet with some lawyers.

[wesphily]

Will the bitshares client ever be able to include personal information required by regulation? If not then it would be nice if somebody wrote software to suppliment the white list feature.

you could do this already today .. your account name registered on the blockchain can contain arbitrary json formated data ...

(wallet closed) >>> blockchain_get_account xeroc
Name: xeroc
.........
Public Data:
{
  "slate_id": 6136676347887220980,
  "mail_server_endpoint": "127.0.0.1:19999",
  "mail_servers": [
    "xeroc"
  ]
}

That's great! It needs to be viewable in a user friendly way to be marketable though

[xeroc]

Will the bitshares client ever be able to include personal information required by regulation? If not then it would be nice if somebody wrote software to suppliment the white list feature.

you could do this already today .. your account name registered on the blockchain can contain arbitrary json formated data ...

(wallet closed) >>> blockchain_get_account xeroc
Name: xeroc
.........
Public Data:
{
  "slate_id": 6136676347887220980,
  "mail_server_endpoint": "127.0.0.1:19999",
  "mail_servers": [
    "xeroc"
  ]
}

[wesphily]

Will the bitshares client ever be able to include personal information required by regulation? If not then it would be nice if somebody wrote software to suppliment the white list feature.

[oldman]

I think we should consider finding an accountant or lawyer to run as a delegate specifically to help folks navigate through the process of setting up a bitAsset/bitCompany/bitCorp etc, as well as provide review/advisory services on the compliance of bitAsset listings.

The last thing we want is a bunch of honest people getting nailed with securities fraud, or worse, scammers committing fraud and sullying the brand.

US/Can centric 'incubator' at first, but as the delegate income grows it is completely conceivable to have a delegate managing an international team of accountants/lawyers/consultants helping business around the globe with bitAssets.

Would be fantastic to start building precedent case law and a body of knowledge/experience around bitAsset issuance and interfacing with the 'real' world.

Incidentally, bitAssets render Kickstarter and Lighthouse obsolete... folks can now issue shares in their ideas instead of having to pussyfoot around with 'rewards' etc.

Everything you just described refers to UIA's, not bitassets.
I guess this post suggests that we need to give up on having "bitasset" mean market-pegged asset...

Yes, the distinction is going to get lost.

UIA's and bitAssets are invariably going to get lumped together during adoption... as is clearly already happening.

[toast]

I think we should consider finding an accountant or lawyer to run as a delegate specifically to help folks navigate through the process of setting up a bitAsset/bitCompany/bitCorp etc, as well as provide review/advisory services on the compliance of bitAsset listings.

The last thing we want is a bunch of honest people getting nailed with securities fraud, or worse, scammers committing fraud and sullying the brand.

US/Can centric 'incubator' at first, but as the delegate income grows it is completely conceivable to have a delegate managing an international team of accountants/lawyers/consultants helping business around the globe with bitAssets.

Would be fantastic to start building precedent case law and a body of knowledge/experience around bitAsset issuance and interfacing with the 'real' world.

Incidentally, bitAssets render Kickstarter and Lighthouse obsolete... folks can now issue shares in their ideas instead of having to pussyfoot around with 'rewards' etc.

Everything you just described refers to UIA's, not bitassets.
I guess this post suggests that we need to give up on having "bitasset" mean market-pegged asset...

[oldman]

I think we should consider finding an accountant or lawyer to run as a delegate specifically to help folks navigate through the process of setting up a bitAsset/bitCompany/bitCorp etc, as well as provide review/advisory services on the compliance of bitAsset listings.

The last thing we want is a bunch of honest people getting nailed with securities fraud, or worse, scammers committing fraud and sullying the brand.

US/Can centric 'incubator' at first, but as the delegate income grows it is completely conceivable to have a delegate managing an international team of accountants/lawyers/consultants helping business around the globe with bitAssets.

Would be fantastic to start building precedent case law and a body of knowledge/experience around bitAsset issuance and interfacing with the 'real' world.

Incidentally, bitAssets render Kickstarter and Lighthouse obsolete... folks can now issue shares in their ideas instead of having to pussyfoot around with 'rewards' etc.

[bytemaster]

It easily works for any size company.  I have plans to work with a lawyer to write a book about how to do this with BitShares.     

First we actually need to enable the white list feature that have been implemented and this is still several weeks away.   Then we need to add GUI tools to help manage your white list. 

[wesphily]

I'm highly interested with incorporating bitshares into my REI LLC. Can a developer please acknowledge that you see the questions below? I don't need answers to them right away, but it would be nice to know that you see them so that you can think about them when possible.

Is it possible to limit the number of shares that an asset allows? I do not want to open up the LLC to random 1$ investors. They will not receive a good roi, and it would be a nightmare for me to try to keep track of a million 1$ investments.

Your company won't be publicly traded anyway. You will be whitelisting keys and so you can make people agree to whatever terms you want. Did you mean to ask, even among people you explicitly whitelist, don't allow them to own less than X number of shares? I don't think that makes sense. Obviously you can limit the number of shares you issue, if that's what you actually meant. Something like 1-5% of companies become $1million dollar companies. Even fewer of those become publicly traded.

EDIT: Can a feature request be made to allow accounts to input all of that information so that they can be "pre-approved" for investments similar to this? Decentralized protection of data that allows you to purchase shares in centralized companies sounds good in my head.

You'll need to do this info verification outside of our system on your, at least until someone makes a service to make it easier. You'll probably have a lot of manual processing to do anyway.

Also, whitelisting: does this mean I could whitelist particular account names so that only they could purchase a share? If so then that would be great since I could gather all the "know your customer" (in this case partner) information needed for the LLC.

Yes, that's the point - you can only legally issue shares if you know who the owners are.


Remember that bitshares is JUST a database that keeps track of who has what. We can make ownership transfer restricted in the ways that make the thing you are transferring a legally compliant share of your company, in particular restricting ownership to people you approve. Everything else is still completely up to you.

Thanks for the responses. I hope you all are able to expand usability in the future. I understand it's use now, but it seems too limited to use.

Online centralized exchanges take care of all the partner information for the companies being traded. This is a very valuable service. I hope that bitshares can do that one day as well.

Finally, this may work great for c-corps, but it will not work for small companies. Partnership is different and has different regulations. Small businesses are a big part of commercial. Would be nice to have solutions for them too. Something like 1-5% of companies become $1million dollar companies. Even fewer of those become publicly traded.

[toast]

I'm highly interested with incorporating bitshares into my REI LLC. Can a developer please acknowledge that you see the questions below? I don't need answers to them right away, but it would be nice to know that you see them so that you can think about them when possible.

Is it possible to limit the number of shares that an asset allows? I do not want to open up the LLC to random 1$ investors. They will not receive a good roi, and it would be a nightmare for me to try to keep track of a million 1$ investments.

Your company won't be publicly traded anyway. You will be whitelisting keys and so you can make people agree to whatever terms you want. Did you mean to ask, even among people you explicitly whitelist, don't allow them to own less than X number of shares? I don't think that makes sense. Obviously you can limit the number of shares you issue, if that's what you actually meant.

EDIT: Can a feature request be made to allow accounts to input all of that information so that they can be "pre-approved" for investments similar to this? Decentralized protection of data that allows you to purchase shares in centralized companies sounds good in my head.

You'll need to do this info verification outside of our system on your, at least until someone makes a service to make it easier. You'll probably have a lot of manual processing to do anyway.

Also, whitelisting: does this mean I could whitelist particular account names so that only they could purchase a share? If so then that would be great since I could gather all the "know your customer" (in this case partner) information needed for the LLC.

Yes, that's the point - you can only legally issue shares if you know who the owners are.


Remember that bitshares is JUST a database that keeps track of who has what. We can make ownership transfer restricted in the ways that make the thing you are transferring a legally compliant share of your company, in particular restricting ownership to people you approve. Everything else is still completely up to you.

[wesphily]

I'm highly interested with incorporating bitshares into my REI LLC. Can a developer please acknowledge that you see the questions below? I don't need answers to them right away, but it would be nice to know that you see them so that you can think about them when possible.

Is it possible to limit the number of shares that an asset allows? I do not want to open up the LLC to random 1$ investors. They will not receive a good roi, and it would be a nightmare for me to try to keep track of a million 1$ investments.

EDIT: Can a feature request be made to allow accounts to input all of that information so that they can be "pre-approved" for investments similar to this? Decentralized protection of data that allows you to purchase shares in centralized companies sounds good in my head.

Also, whitelisting: does this mean I could whitelist particular account names so that only they could purchase a share? If so then that would be great since I could gather all the "know your customer" (in this case partner) information needed for the LLC.

[fluxer555]

While I don't have much to contribute to this thread, I just wanted to say thank you to wesphily for asking these important questions, slashing a path through this uncharted dense jungle of regulation, allowing others to follow in your footsteps.

[wesphily]

Another issue that nobody has brought up yet is that in the US, I believe it's illegal for the owners of a publicly-traded company to be anonymous. This is the issue the whitelisting is trying to get around, I think. But for you as the guy running the company, I think you have to keep paperwork that shows exactly who owns which shares of the company at any given time.

If you tried to structure your securities as a debt instrument, this might not apply... but I am not experienced in such things.

Sent from my SCH-S720C using Tapatalk 2

Is it possible to limit the number of shares that an asset allows? I do not want to open up the LLC to random 1$ investors. They will not receive a good roi, and it would be a nightmare for me to try to keep track of a million 1$ investments.

EDIT: Can a feature request be made to allow accounts to input all of that information so that they can be "pre-approved" for investments similar to this? Decentralized protection of data that allows you to purchase shares in centralized companies sounds good in my head.

Also, whitelisting: does this mean I could whitelist particular account names so that only they could purchase a share? If so then that would be great since I could gather all the "know your customer" (in this case partner) information needed for the LLC.

[biophil]

Another issue that nobody has brought up yet is that in the US, I believe it's illegal for the owners of a publicly-traded company to be anonymous. This is the issue the whitelisting is trying to get around, I think. But for you as the guy running the company, I think you have to keep paperwork that shows exactly who owns which shares of the company at any given time.

If you tried to structure your securities as a debt instrument, this might not apply... but I am not experienced in such things.

Sent from my SCH-S720C using Tapatalk 2

[wesphily]

What about a REIT that only sold to people not living in the US. That might get you off the SEC's radar.

REIT has a ton of requirements. I personally would not qualify for this since a majority of my income does not come from real estate currently. Most of my income comes from IT.

EDIT: I'm trying to avoid heavily regulated options.