Thread by @Jason

Someone just asked me about raising a seed round (equity) and selling tokens at the same time.

My advice to founders: Selling two different securities at the same time, to two different sets of investors, is a quick way to get sued.

2/There is no way that a token & a share in a company will move in the same exact way. In fact, the likely scenario is they will move in different directions often.

This means if your equity goes down in value and your token appreciates, the equity shareholders will sue you.

3/If the tokens become worthless, which they will in 95%+ of #ICOs, and the shares skyrocket, well, those ICO "investors" will sue you!

4/I put investors in quotes because the big trend is ICOs seems to be that founders are pretending they are selling chuck e cheese style utility tokens, and the "investors" are buying them thinking they are stocks that will appreciate.

5/A lot of these ICO kids are going to get huge fines and go to jail -- at least if they are citizens of the United States.