I want to invest because this looks great, but there appears to be a major red flag. Hopefully somebody can clear this up for me.
In the Monetha video at the 4 minute and 40 second mark the CEO is telling people that if they participate in the ICO that they will receive a significant portion of revenue.
If Monetha has revenue flowing to the token holders, this makes Monetha a security, which in and of itself I am okay with. The SEC said that they were going to be coming after crypto exchanges which trade tokens which are viewed as securities. What happens if exchanges suddenly stop listing tokens which are securities? If there is no market for this token to trade in, then how is there price discovery? If there is no price discovery, then how does anybody ever expect to get their money back?
I suggest everybody read the blog post from Shapeshift from a couple of weeks ago. It describes how they are about to begin to delist a bunch of tokens because they were determined to be securities. The way you determine if a token is a security is by performing the Howey test. (Google Howey test if you don't know what it is.)
The Howey test is simple. If all 4 elements are present, then the SEC will classify it as a security. Those elements are.
1)Money is raised
2)For a common enterprise
3)With the expectation of a return
4)From the efforts of others.
https://info.shapeshift.io/blog/2017/08/17/shapeshift-and-tokens-securitiesIf Monetha is actually planning on distributing profits, then I cannot participate. A simple solution is for Monetha to simply not redistribute the profits. Just keep piling the profits back into the business, or find some other way of rewarding the token holders within the system. Your business idea is good enough that you do not need to give token holders profits.
Hello sayulita,
As of today, no token is considered as a security, however, when the regulation starts to crack down, dividend bearing tokens may be the first ones considered as a security. It's important to consider that many regulators may follow these examples because of the fact that it's currently unregulated.
We spoke with our experienced lawyers in Switzerland, and this decision was made to protect you (the investors), and ourselves when such regulations come. Not only that, but we believe this new token model will benefit the ecosystem, and will help us with the future growth, which equals to the income growth, which then equals investor return growth.
This voucher model is approved by KPMG lawyers from Switzerland. You can read more in the whitepaper.Regards,
Monetha Team