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Howey Test and Cryptocurrencies: 'Every ICO Is a Security'
What Is the Howey Test?
To determine whether a transaction qualifies as a "investment contract" and thus qualifies as a security, the Howey Test refers to the U.S. Supreme Court cass: the Securities Act of 1933 and the Securities Exchange Act of 1934. According to the Howey Test, an investment contract exists when "money is invested in a common enterprise with a reasonable expectation of profits from others' efforts."
The test applies to any contract, scheme, or transaction. The Howey Test helps investors and project backers understand blockchain and digital currency projects. ICOs and certain cryptocurrencies may be found to be "investment contracts" under the test.
Understanding the Howey Test
The Howey Test comes from the 1946 Supreme Court case SEC v. W.J. Howey Co. The Howey Company sold citrus groves to Florida buyers who leased them back to Howey. The company would maintain the groves and sell the fruit for the owners. Both parties benefited. Most buyers had no farming experience and were not required to farm the land.
The SEC intervened because Howey failed to register the transactions. The court ruled that the leaseback agreements were investment contracts.
This established four criteria for determining an investment contract. Investing contract:
- An investment of money
- n a common enterprise
- With the expectation of profit
- To be derived from the efforts of others
In the case of Howey, the buyers saw the transactions as valuable because others provided the labor and expertise. An income stream was obtained by only investing capital. As a result of the Howey Test, the transaction had to be registered with the SEC.
Howey Test and Cryptocurrencies
Bitcoin is notoriously difficult to categorize. Decentralized, they evade regulation in many ways. Regardless, the SEC is looking into digital assets and determining when their sale qualifies as an investment contract.
The SEC claims that selling digital assets meets the "investment of money" test because fiat money or other digital assets are being exchanged. Like the "common enterprise" test.
Whether a digital asset qualifies as an investment contract depends on whether there is a "expectation of profit from others' efforts."
For example, buyers of digital assets may be relying on others' efforts if they expect the project's backers to build and maintain the digital network, rather than a dispersed community of unaffiliated users. Also, if the project's backers create scarcity by burning tokens, the test is met. Another way the "efforts of others" test is met is if the project's backers continue to act in a managerial role.
These are just a few examples given by the SEC. If a project's success is dependent on ongoing support from backers, the buyer of the digital asset is likely relying on "others' efforts."
Special Considerations
If the SEC determines a cryptocurrency token is a security, many issues arise. It means the SEC can decide whether a token can be sold to US investors and forces the project to register.
In 2017, the SEC ruled that selling DAO tokens for Ether violated federal securities laws. Instead of enforcing securities laws, the SEC issued a warning to the cryptocurrency industry.
Due to the Howey Test, most ICOs today are likely inaccessible to US investors. After a year of ICOs, then-SEC Chair Jay Clayton declared them all securities.
SEC Chairman Gensler Agrees With Predecessor: 'Every ICO Is a Security'
Howey Test FAQs
How Do You Determine If Something Is a Security?
The Howey Test determines whether certain transactions are "investment contracts." Securities are transactions that qualify as "investment contracts" under the Securities Act of 1933 and the Securities Exchange Act of 1934.
The Howey Test looks for a "investment of money in a common enterprise with a reasonable expectation of profits from others' efforts." If so, the Securities Act of 1933 and the Securities Exchange Act of 1934 require disclosure and registration.
Why Is Bitcoin Not a Security?
Former SEC Chair Jay Clayton clarified in June 2018 that bitcoin is not a security: "Cryptocurrencies: Replace the dollar, euro, and yen with bitcoin. That type of currency is not a security," said Clayton.
Bitcoin, which has never sought public funding to develop its technology, fails the SEC's Howey Test. However, according to Clayton, ICO tokens are securities.
A Security Defined by the SEC
In the public and private markets, securities are fungible and tradeable financial instruments. The SEC regulates public securities sales.
The Supreme Court defined a security offering in SEC v. W.J. Howey Co. In its judgment, the court defines a security using four criteria:
- An investment contract's existence
- The formation of a common enterprise
- The issuer's profit promise
- Third-party promotion of the offering
Read original post.
More on Web3 & Crypto
CoinTelegraph
3 years ago
2 NFT-based blockchain games that could soar in 2022
NFTs look ready to rule 2022, and the recent pivot toward NFT utility in P2E gaming could make blockchain gaming this year’s sector darling.
After the popularity of decentralized finance (DeFi) came the rise of nonfungible tokens (NFTs), and to the surprise of many, NFTs took the spotlight and now remain front and center with the highest volume in sales occurring at the start of January 2022.
While 2021 became the year of NFTs, GameFi applications did surpass DeFi in terms of user popularity. According to data from DappRadar, Bloomberg gathered:
Nearly 50% of active cryptocurrency wallets connected to decentralized applications in November were for playing games. The percentage of wallets linked to decentralized finance, or DeFi, dapps fell to 45% during the same period, after months of being the leading dapp use case.
Blockchain play-to-earn (P2E) game Axie infinity skyrocketed and kicked off a gaming craze that is expected to continue all throughout 2022. Crypto pundits and gaming advocates have high expectations for P2E blockchain-based games and there’s bound to be a few sleeping giants that will dominate the sector.
Let’s take a look at five blockchain games that could make waves in 2022.
DeFi Kingdoms
The inspiration for DeFi Kingdoms came from simple beginnings — a passion for investing that lured the developers to blockchain technology. DeFi Kingdoms was born as a visualization of liquidity pool investing where in-game ‘gardens’ represent literal and figurative token pairings and liquidity pool mining.
As shown in the game, investors have a portion of their LP share within a plot filled with blooming plants. By attaching the concept of growth to DeFi protocols within a play-and-earn model, DeFi Kingdoms puts a twist on “playing” a game.
Built on the Harmony Network, DeFi Kingdoms became the first project on the network to ever top the DappRadar charts. This could be attributed to an influx of individuals interested in both DeFi and blockchain games or it could be attributed to its recent in-game utility token JEWEL surging.
JEWEL is a utility token that allows users to purchase NFTs in-game buffs to increase a base-level stat. It is also used for liquidity mining to grant users the opportunity to make more JEWEL through staking.
JEWEL is also a governance token that gives holders a vote in the growth and evolution of the project. In the past four months, the token price surged from $1.23 to an all-time high of $22.52. At the time of writing, JEWEL is down by nearly 16%, trading at $19.51.
Surging approximately 1,487% from its humble start of $1.23 four months ago in September, JEWEL token price has increased roughly 165% this last month alone, according to data from CoinGecko.
Guild of Guardians
Guild of Guardians is one of the more anticipated blockchain games in 2022 and it is built on ImmutableX, the first layer-two solution built on Ethereum that focuses on NFTs. Aiming to provide more access, it will operate as a free-to-play mobile role-playing game, modeling the P2E mechanics.
Similar to blockchain games like Axie Infinity, Guild of Guardians in-game assets can be exchanged. The project seems to be of interest to many gamers and investors with its NFT founder sale and token launch generating nearly $10 million in volume.
Launching its in-game token in October of 2021, the Guild of Guardians (GOG) tokens are ERC-20 tokens known as ‘gems’ inside the game. Gems are what power key features in the game such as minting in-game NFTs and interacting with the marketplace, and are available to earn while playing.
For the last month, the Guild of Guardians token has performed rather steadily after spiking to its all-time high of $2.81 after its launch. Despite the token being down over 50% from its all-time high, at the time of writing, some members of the community are looking forward to the possibility of staking and liquidity pools, which are features that tend to help stabilize token prices.
Jayden Levitt
3 years ago
The country of El Salvador's Bitcoin-obsessed president lost $61.6 million.
It’s only a loss if you sell, right?
Nayib Bukele proclaimed himself “the world’s coolest dictator”.
His jokes aren't clear.
El Salvador's 43rd president self-proclaimed “CEO of El Salvador” couldn't be less presidential.
His thin jeans, aviator sunglasses, and baseball caps like a cartel lord.
He's popular, though.
Bukele won 53% of the vote by fighting violent crime and opposition party corruption.
El Salvador's 6.4 million inhabitants are riding the cryptocurrency volatility wave.
They were powerless.
Their autocratic leader, a former Yamaha Motors salesperson and Bitcoin believer, wants to help 70% unbanked locals.
He intended to give the citizens a way to save money and cut the country's $200 million remittance cost.
Transfer and deposit costs.
This makes logical sense when the president’s theatrics don’t blind you.
El Salvador's Bukele revealed plans to make bitcoin legal tender.
Remittances total $5.9 billion (23%) of the country's expenses.
Anything that reduces costs could boost the economy.
The country’s unbanked population is staggering. Here’s the data by % of people who either have a bank account (Blue) or a mobile money account (Black).
According to Bukele, 46% of the population has downloaded the Chivo Bitcoin Wallet.
In 2021, 36% of El Salvadorans had bank accounts.
Large rural countries like Kenya seem to have resolved their unbanked dilemma.
An economy surfaced where village locals would sell, trade and store network minutes and data as a store of value.
Kenyan phone networks realized unbanked people needed a safe way to accumulate wealth and have an emergency fund.
96% of Kenyans utilize M-PESA, which doesn't require a bank account.
The software involves human agents who hang out with cash and a phone.
These people are like ATMs.
You offer them cash to deposit money in your mobile money account or withdraw cash.
In a country with a faulty banking system, cash availability and a safe place to deposit it are important.
William Jack and Tavneet Suri found that M-PESA brought 194,000 Kenyan households out of poverty by making transactions cheaper and creating a safe store of value.
Mobile money, a service that allows monetary value to be stored on a mobile phone and sent to other users via text messages, has been adopted by most Kenyan households. We estimate that access to the Kenyan mobile money system M-PESA increased per capita consumption levels and lifted 194,000 households, or 2% of Kenyan households, out of poverty.
The impacts, which are more pronounced for female-headed households, appear to be driven by changes in financial behaviour — in particular, increased financial resilience and saving. Mobile money has therefore increased the efficiency of the allocation of consumption over time while allowing a more efficient allocation of labour, resulting in a meaningful reduction of poverty in Kenya.
Currently, El Salvador has 2,301 Bitcoin.
At publication, it's worth $44 million. That remains 41% of Bukele's original $105.6 million.
Unknown if the country has sold Bitcoin, but Bukeles keeps purchasing the dip.
It's still falling.
This might be a fantastic move for the impoverished country over the next five years, if they can live economically till Bitcoin's price recovers.
The evidence demonstrates that a store of value pulls individuals out of poverty, but others say Bitcoin is premature.
You may regard it as an aggressive endeavor to front run the next wave of adoption, offering El Salvador a financial upside.
James Howell
3 years ago
Which Metaverse Is Better, Decentraland or Sandbox?
The metaverse is the most commonly used term in current technology discussions. While the entire tech ecosystem awaits the metaverse's full arrival, defining it is difficult. Imagine the internet in the '80s! The metaverse is a three-dimensional virtual world where users can interact with digital solutions and each other as digital avatars.
The metaverse is a three-dimensional virtual world where users can interact with digital solutions and each other as digital avatars.
Among the metaverse hype, the Decentraland vs Sandbox debate has gained traction. Both are decentralized metaverse platforms with no central authority. So, what's the difference and which is better? Let us examine the distinctions between Decentraland and Sandbox.
2 Popular Metaverse Platforms Explained
The first step in comparing sandbox and Decentraland is to outline the definitions. Anyone keeping up with the metaverse news has heard of the two current leaders. Both have many similarities, but also many differences. Let us start with defining both platforms to see if there is a winner.
Decentraland
Decentraland, a fully immersive and engaging 3D metaverse, launched in 2017. It allows players to buy land while exploring the vast virtual universe. Decentraland offers a wide range of activities for its visitors, including games, casinos, galleries, and concerts. It is currently the longest-running metaverse project.
Decentraland began with a $24 million ICO and went public in 2020. The platform's virtual real estate parcels allow users to create a variety of experiences. MANA and LAND are two distinct tokens associated with Decentraland. MANA is the platform's native ERC-20 token, and users can burn MANA to get LAND, which is ERC-721 compliant. The MANA coin can be used to buy avatars, wearables, products, and names on Decentraland.
Sandbox
Sandbox, the next major player, began as a blockchain-based virtual world in 2011 and migrated to a 3D gaming platform in 2017. The virtual world allows users to create, play, own, and monetize their virtual experiences. Sandbox aims to empower artists, creators, and players in the blockchain community to customize the platform. Sandbox gives the ideal means for unleashing creativity in the development of the modern gaming ecosystem.
The project combines NFTs and DAOs to empower a growing community of gamers. A new play-to-earn model helps users grow as gamers and creators. The platform offers a utility token, SAND, which is required for all transactions.
What are the key points from both metaverse definitions to compare Decentraland vs sandbox?
It is ideal for individuals, businesses, and creators seeking new artistic, entertainment, and business opportunities. It is one of the rapidly growing Decentralized Autonomous Organization projects. Holders of MANA tokens also control the Decentraland domain.
Sandbox, on the other hand, is a blockchain-based virtual world that runs on the native token SAND. On the platform, users can create, sell, and buy digital assets and experiences, enabling blockchain-based gaming. Sandbox focuses on user-generated content and building an ecosystem of developers.
Sandbox vs. Decentraland
If you try to find what is better Sandbox or Decentraland, then you might struggle with only the basic definitions. Both are metaverse platforms offering immersive 3D experiences. Users can freely create, buy, sell, and trade digital assets. However, both have significant differences, especially in MANA vs SAND.
For starters, MANA has a market cap of $5,736,097,349 versus $4,528,715,461, giving Decentraland an advantage.
The MANA vs SAND pricing comparison is also noteworthy. A SAND is currently worth $3664, while a MANA is worth $2452.
The value of the native tokens and the market capitalization of the two metaverse platforms are not enough to make a choice. Let us compare Sandbox vs Decentraland based on the following factors.
Workstyle
The way Decentraland and Sandbox work is one of the main comparisons. From a distance, they both appear to work the same way. But there's a lot more to learn about both platforms' workings. Decentraland has 90,601 digital parcels of land.
Individual parcels of virtual real estate or estates with multiple parcels of land are assembled. It also has districts with similar themes and plazas, which are non-tradeable parcels owned by the community. It has three token types: MANA, LAND, and WEAR.
Sandbox has 166,464 plots of virtual land that can be grouped into estates. Estates are owned by one person, while districts are owned by two or more people. The Sandbox metaverse has four token types: SAND, GAMES, LAND, and ASSETS.
Age
The maturity of metaverse projects is also a factor in the debate. Decentraland is clearly the winner in terms of maturity. It was the first solution to create a 3D blockchain metaverse. Decentraland made the first working proof of concept public. However, Sandbox has only made an Alpha version available to the public.
Backing
The MANA vs SAND comparison would also include support for both platforms. Digital Currency Group, FBG Capital, and CoinFund are all supporters of Decentraland. It has also partnered with Polygon, the South Korean government, Cyberpunk, and Samsung.
SoftBank, a Japanese multinational conglomerate focused on investment management, is another major backer. Sandbox has the backing of one of the world's largest investment firms, as well as Slack and Uber.
Compatibility
Wallet compatibility is an important factor in comparing the two metaverse platforms. Decentraland currently has a competitive advantage. How? Both projects' marketplaces accept ERC-20 wallets. However, Decentraland has recently improved by bridging with Walletconnect. So it can let Polygon users join Decentraland.
Scalability
Because Sandbox and Decentraland use the Ethereum blockchain, scalability is an issue. Both platforms' scalability is constrained by volatile tokens and high gas fees. So, scalability issues can hinder large-scale adoption of both metaverse platforms.
Buying Land
Decentraland vs Sandbox comparisons often include virtual real estate. However, the ability to buy virtual land on both platforms defines the user experience and differentiates them. In this case, Sandbox offers better options for users to buy virtual land by combining OpenSea and Sandbox. In fact, Decentraland users can only buy from the MANA marketplace.
Innovation
The rate of development distinguishes Sandbox and Decentraland. Both platforms have been developing rapidly new features. However, Sandbox wins by adopting Polygon NFT layer 2 solutions, which consume almost 100 times less energy than Ethereum.
Collaborations
The platforms' collaborations are the key to determining "which is better Sandbox or Decentraland." Adoption of metaverse platforms like the two in question can be boosted by association with reputable brands. Among the partners are Atari, Cyberpunk, and Polygon. Rather, Sandbox has partnered with well-known brands like OpenSea, CryptoKitties, The Walking Dead, Snoop Dogg, and others.
Platform Adaptivity
Another key feature that distinguishes Sandbox and Decentraland is the ease of use. Sandbox clearly wins in terms of platform access. It allows easy access via social media, email, or a Metamask wallet. However, Decentraland requires a wallet connection.
Prospects
The future development plans also play a big role in defining Sandbox vs Decentraland. Sandbox's future development plans include bringing the platform to mobile devices. This includes consoles like PlayStation and Xbox. By the end of 2023, the platform expects to have around 5000 games.
Decentraland, on the other hand, has no set plan. In fact, the team defines the decisions that appear to have value. They plan to add celebrities, creators, and brands soon, along with NFT ads and drops.
Final Words
The comparison of Decentraland vs Sandbox provides a balanced view of both platforms. You can see how difficult it is to determine which decentralized metaverse is better now. Sandbox is still in Alpha, whereas Decentraland has a working proof of concept.
Sandbox, on the other hand, has better graphics and is backed by some big names. But both have a long way to go in the larger decentralized metaverse.
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Raad Ahmed
3 years ago
How We Just Raised $6M At An $80M Valuation From 100+ Investors Using A Link (Without Pitching)
Lawtrades nearly failed three years ago.
We couldn't raise Series A or enthusiasm from VCs.
We raised $6M (at a $80M valuation) from 100 customers and investors using a link and no pitching.
Step-by-step:
We refocused our business first.
Lawtrades raised $3.7M while Atrium raised $75M. By comparison, we seemed unimportant.
We had to close the company or try something new.
As I've written previously, a pivot saved us. Our initial focus on SMBs attracted many unprofitable customers. SMBs needed one-off legal services, meaning low fees and high turnover.
Tech startups were different. Their General Councels (GCs) needed near-daily support, resulting in higher fees and lower churn than SMBs.
We stopped unprofitable customers and focused on power users. To avoid dilution, we borrowed against receivables. We scaled our revenue 10x, from $70k/mo to $700k/mo.
Then, we reconsidered fundraising (and do it differently)
This time was different. Lawtrades was cash flow positive for most of last year, so we could dictate our own terms. VCs were still wary of legaltech after Atrium's shutdown (though they were thinking about the space).
We neither wanted to rely on VCs nor dilute more than 10% equity. So we didn't compete for in-person pitch meetings.
AngelList Roll-Up Vehicle (RUV). Up to 250 accredited investors can invest in a single RUV. First, we emailed customers the RUV. Why? Because I wanted to help the platform's users.
Imagine if Uber or Airbnb let all drivers or Superhosts invest in an RUV. Humans make the platform, theirs and ours. Giving people a chance to invest increases their loyalty.
We expanded after initial interest.
We created a Journey link, containing everything that would normally go in an investor pitch:
- Slides
- Trailer (from me)
- Testimonials
- Product demo
- Financials
We could also link to our AngelList RUV and send the pitch to an unlimited number of people. Instead of 1:1, we had 1:10,000 pitches-to-investors.
We posted Journey's link in RUV Alliance Discord. 600 accredited investors noticed it immediately. Within days, we raised $250,000 from customers-turned-investors.
Stonks, which live-streamed our pitch to thousands of viewers, was interested in our grassroots enthusiasm. We got $1.4M from people I've never met.
These updates on Pump generated more interest. Facebook, Uber, Netflix, and Robinhood executives all wanted to invest. Sahil Lavingia, who had rejected us, gave us $100k.
We closed the round with public support.
Without a single pitch meeting, we'd raised $2.3M. It was a result of natural enthusiasm: taking care of the people who made us who we are, letting them move first, and leveraging their enthusiasm with VCs, who were interested.
We used network effects to raise $3.7M from a founder-turned-VC, bringing the total to $6M at a $80M valuation (which, by the way, I set myself).
What flipping the fundraising script allowed us to do:
We started with private investors instead of 2–3 VCs to show VCs what we were worth. This gave Lawtrades the ability to:
- Without meetings, share our vision. Many people saw our Journey link. I ended up taking meetings with people who planned to contribute $50k+, but still, the ratio of views-to-meetings was outrageously good for us.
- Leverage ourselves. Instead of us selling ourselves to VCs, they did. Some people with large checks or late arrivals were turned away.
- Maintain voting power. No board seats were lost.
- Utilize viral network effects. People-powered.
- Preemptively halt churn by turning our users into owners. People are more loyal and respectful to things they own. Our users make us who we are — no matter how good our tech is, we need human beings to use it. They deserve to be owners.
I don't blame founders for being hesitant about this approach. Pump and RUVs are new and scary. But it won’t be that way for long. Our approach redistributed some of the power that normally lies entirely with VCs, putting it into our hands and our network’s hands.
This is the future — another way power is shifting from centralized to decentralized.
Rachel Greenberg
3 years ago
The Unsettling Fact VC-Backed Entrepreneurs Don't Want You to Know
What they'll do is scarier.
My acquaintance recently joined a VC-funded startup. Money, equity, and upside possibilities were nice, but he had a nagging dread.
They just secured a $40M round and are hiring like crazy to prepare for their IPO in two years. All signals pointed to this startup's (a B2B IT business in a stable industry) success, and its equity-holding workers wouldn't pass that up.
Five months after starting the work, my friend struggled with leaving. We might overlook the awful culture and long hours at the proper price. This price plus the company's fate and survival abilities sent my friend departing in an unpleasant unplanned resignation before jumping on yet another sinking ship.
This affects founders. This affects VC-backed companies (and all businesses). This affects anyone starting, buying, or running a business.
Here's the under-the-table approach that's draining VC capital, leaving staff terrified (or jobless), founders rattled, and investors upset. How to recognize, solve, and avoid it
The unsettling reality behind door #1
You can't raise money off just your looks, right? If "looks" means your founding team's expertise, then maybe. In my friend's case, the founding team's strong qualifications and track records won over investors before talking figures.
They're hardly the only startup to raise money without a profitable customer acquisition strategy. Another firm raised money for an expensive sleep product because it's eco-friendly. They were off to the races with a few keywords and key players.
Both companies, along with numerous others, elected to invest on product development first. Company A employed all the tech, then courted half their market (they’re a tech marketplace that connects two parties). Company B spent millions on R&D to create a palatable product, then flooded the world with marketing.
My friend is on Company B's financial team, and he's seen where they've gone wrong. It's terrible.
Company A (tech market): Growing? Not quite. To achieve the ambitious expansion they (and their investors) demand, they've poured much of their little capital into salespeople: Cold-calling commission and salary salesmen. Is it working? Considering attrition and companies' dwindling capital, I don't think so.
Company B (green sleep) has been hiring, digital marketing, and opening new stores like crazy. Growing expenses should result in growing revenues and a favorable return on investment; if you grow too rapidly, you may neglect to check that ROI.
Once Company A cut headcount and Company B declared “going concerned”, my friend realized both startups had the same ailment and didn't recognize it.
I shouldn't have to ask a friend to verify a company's cash reserves and profitability to spot a financial problem. It happened anyhow.
The frightening part isn't that investors were willing to invest millions without product-market fit, CAC, or LTV estimates. That's alarming, but not as scary as the fact that startups aren't understanding the problem until VC rounds have dried up.
When they question consultants if their company will be around in 6 months. It’s a red flag. How will they stretch $20M through a 2-year recession with a $3M/month burn rate and no profitability? Alarms go off.
Who's in danger?
In a word, everyone who raised money without a profitable client acquisition strategy or enough resources to ride out dry spells.
Money mismanagement and poor priorities affect every industry (like sinking all your capital into your product, team, or tech, at the expense of probing what customer acquisition really takes and looks like).
This isn't about tech, real estate, or recession-proof luxury products. Fast, cheap, easy money flows into flashy-looking teams with buzzwords, trending industries, and attractive credentials.
If these companies can't show progress or get a profitable CAC, they can't raise more money. They die if they can't raise more money (or slash headcount and find shoestring budget solutions until they solve the real problem).
The kiss of death (and how to avoid it)
If you're running a startup and think raising VC is the answer, pause and evaluate. Do you need the money now?
I'm not saying VC is terrible or has no role. Founders have used it as a Band-Aid for larger, pervasive problems. Venture cash isn't a crutch for recruiting consumers profitably; it's rocket fuel to get you what and who you need.
Pay-to-play isn't a way to throw money at the wall and hope for a return. Pay-to-play works until you run out of money, and if you haven't mastered client acquisition, your cash will diminish quickly.
How can you avoid this bottomless pit? Tips:
Understand your burn rate
Keep an eye on your growth or profitability.
Analyze each and every marketing channel and initiative.
Make lucrative customer acquisition strategies and satisfied customers your top two priorities. not brand-new products. not stellar hires. avoid the fundraising rollercoaster to save time. If you succeed in these two tasks, investors will approach you with their thirsty offers rather than the other way around, and your cash reserves won't diminish as a result.
Not as much as your grandfather
My family friend always justified expensive, impractical expenditures by saying it was only monopoly money. In business, startups, and especially with money from investors expecting a return, that's not true.
More founders could understand that there isn't always another round if they viewed VC money as their own limited pool. When the well runs dry, you must refill it or save the day.
Venture financing isn't your grandpa's money. A discerning investor has entrusted you with dry powder in the hope that you'll use it wisely, strategically, and thoughtfully. Use it well.
Isaiah McCall
2 years ago
There is a new global currency emerging, but it is not bitcoin.
America should avoid BRICS
Vladimir Putin has watched videos of Muammar Gaddafi's CIA-backed demise.
Gaddafi...
Thief.
Did you know Gaddafi wanted a gold-backed dinar for Africa? Because he considered our global financial system was a Ponzi scheme, he wanted to discontinue trading oil in US dollars.
Or, Gaddafi's Libya enjoyed Africa's highest quality of living before becoming freed. Pictured:
Vladimir Putin is a nasty guy, but he had his reasons for not mentioning NATO assisting Ukraine in resisting US imperialism. Nobody tells you. Sure.
The US dollar's corruption post-2008, debasement by quantitative easing, and lack of value are key factors. BRICS will replace the dollar.
BRICS aren't bricks.
Economy-related.
Brazil, Russia, India, China, and South Africa have cooperated for 14 years to fight U.S. hegemony with a new international currency: BRICS.
BRICS is mostly comical. Now. Saudi Arabia, the second-largest oil hegemon, wants to join.
So what?
The New World Currency is BRICS
Russia was kicked out of G8 for its aggressiveness in Crimea in 2014.
It's now G7.
No biggie, said Putin, he said, and I quote, “Bon appetite.”
He was prepared. China, India, and Brazil lead the New World Order.
Together, they constitute 40% of the world's population and, according to the IMF, 50% of the world's GDP by 2030.
Here’s what the BRICS president Marcos Prado Troyjo had to say earlier this year about no longer needing the US dollar: “We have implemented the mechanism of mutual settlements in rubles and rupees, and there is no need for our countries to use the dollar in mutual settlements. And today a similar mechanism of mutual settlements in rubles and yuan is being developed by China.”
Ick. That's D.C. and NYC warmongers licking their chops for WW3 nasty.
Here's a lovely picture of BRICS to relax you:
If Saudi Arabia joins BRICS, as President Mohammed Bin Salman has expressed interest, a majority of the Middle East will have joined forces to construct a new world order not based on the US currency.
I'm not sure of the new acronym.
SBRICSS? CIRBSS? CRIBSS?
The Reason America Is Harvesting What It Sowed
BRICS began 14 years ago.
14 years ago, what occurred? Concentrate. It involved CDOs, bad subprime mortgages, and Wall Street quants crunching numbers.
2008 recession
When two nations trade, they do so in US dollars, not Euros or gold.
What happened when 2008, an avoidable crisis caused by US banks' cupidity and ignorance, what happened?
Everyone WORLDWIDE felt the pain.
Mostly due to corporate America's avarice.
This should have been a warning that China and Russia had enough of our bs. Like when France sent a battleship to America after Nixon scrapped the gold standard. The US was warned to shape up or be dethroned (or at least try).
Nixon improved in 1971. Kinda. Invented PetroDollar.
Another BS system that unfairly favors America and possibly pushed Russia, China, and Saudi Arabia into BRICS.
The PetroDollar forces oil-exporting nations to trade in US dollars and invest in US Treasury bonds. Brilliant. Genius evil.
Our misdeeds are:
In conflicts that are not its concern, the USA uses the global reserve currency as a weapon.
Targeted nations abandon the dollar, and rightfully so, as do nations that depend on them for trade in vital resources.
The dollar's position as the world's reserve currency is in jeopardy, which could have disastrous economic effects.
Although we have actually sown our own doom, we appear astonished. According to the Bible, whomever sows to appease his sinful nature will reap destruction from that nature whereas whoever sows to appease the Spirit will reap eternal life from the Spirit.
Americans, even our leaders, lack caution and delayed pleasure. When our unsustainable systems fail, we double down. Bailouts of the banks in 2008 were myopic, puerile, and another nail in America's hegemony.
America has screwed everyone.
We're unpopular.
The BRICS's future
It's happened before.
Saddam Hussein sold oil in Euros in 2000, and the US invaded Iraq a month later. The media has devalued the word conspiracy. The Iraq conspiracy.
There were no WMDs, but NYT journalists like Judy Miller drove Americans into a warmongering frenzy because Saddam would ruin the PetroDollar. Does anyone recall that this war spawned ISIS?
I think America has done good for the world. You can make a convincing case that we're many people's villain.
Learn more in Confessions of an Economic Hitman, The Devil's Chessboard, or Tyranny of the Federal Reserve. Or ignore it. That's easier.
We, America, should extend an olive branch, ask for forgiveness, and learn from our faults, as the Tao Te Ching advises. Unlikely. Our population is apathetic and stupid, and our government is corrupt.
Argentina, Iran, Egypt, and Turkey have also indicated interest in joining BRICS. They're also considering making it gold-backed, making it a new world reserve currency.
You should pay attention.
Thanks for reading!