In the US it is considered to be unethical for attorneys to advertise their services or to solicit a client for a specific case.
It is unethical to solicit individuals for legal services unless there is a prior or current attorney-client relationship. An attorney or firm can however advertise to the general public. George D. Greenberg, Esq. www.attorneybitcoin.com |
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Dear Community: I have seen many creative and useful business ventures related to crypto-currencies. I continue to be impressed at how innovative the software engineers, developers, business persons and marketers are. In any crypto currency related business there are many issues to consider upon start up. I would like to list some important ones and seek input from others as well. 1. You may want to create a business entity such as an LLC or a Corporation, but don't assume that you need to do this. It depends upon the nature of the business you are conducting. For example if you are a trader of crypto and you do it only for yourself, it might not even be a good idea to create a business entity as it would draw attention from regulators, banks and taxation officials, among others. What you are doing is generally perfectly legal, and there is no need to draw attention to yourself. Just make your money and pay your taxes. However if you are opening a major operation, be it a trading platform, large mining farm, an investment service, a new coin, or other large enterprise, then you would be better off forming a business entity for credibility, asset protection, and taxation issues. The choice of States should be considered as well. I prefer Nevada for the clients I represent so that I may be the front line for any issues that arise. 2. I always advise that any partners be trusted, known, skilled persons. The fewer partners the better. This is not always practical depending on the size of the venture. Consider making others independent contractors rather than partners, with a set percentage that has a cap. You may also offer a hybrid deal, payment of value up front plus a percentage. 3. Have an attorney draft any contracts or terms of service. Work with the attorney to make sure that they reflect what you want. 4. Consult with an attorney regarding laws related to what you are going to be doing. It is possible to get the licenses and approvals you need on your own without the help of an attorney, but at least get input on the process as you go along. 5. If you are purchasing equipment do not be hasty. Study the supplier, look for reviews, and take delivery of larger orders in stages. 6. Many people are looking to mine lately which is fine, however it has been my personal and observed experience that mining is not as simple as it may appear. In addition you run risks of the crypto-currencies that you are mining dropping in value, hacking, companies going out of business, miners overheating, miners simply breaking down or arriving defective, power rates rising, and so on and so forth. Try to talk to those who have gone before you before you leap. 7. If you are trading coins, study the coins, go to the opening page, look at the last few pages of the thread, follow it for awhile, ask yourself if it does anything useful or better. 8. Owning a business that deals in fiat such as most ATM's or an exchange will likely require that you register with FinCEN and set up an AML compliance program. This is not as hard as it sounds but it is important. In general, under these circumstances, the higher the dollar amount, the more information you will be required to obtain from the customer. 9. Be patient with yourself and others in the process. Things of quality and value take time and effort. George D. Greenberg, Esq. www.attorneybitcoin.comThis is good advise. What do you think about using Token Generating Events for a Reg A+ fund raising? Have several projects in our Blockchain Start Up Incubator interested in this type of fund raising. Could you please reply by Private Message. Thank you. According to my associate attorney Huong Lam: Regulation A+ can be thought of as an alternative to a small registered IPO and as either an alternative or a complement to other securities offering methods that are exempt from registration under the Securities Act. Regulation A+ rules create two tiers of offerings, each with slightly different requirements. Reg A+ is attractive because it is a SEC registration exemption and issuers can test the water via oral or written communications (but cannot collect funds or promises for future payment). Issuers would still have to obtain SEC qualification to issue the ICO, put out an offering statement, and adhere to certain reporting requirements. Best: George D. Greenberg, Esq. www.attorneybitcoin |
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We will study this issue and have an opinion for you. It would be easier for me if you would please PM me here or contact through my web site, www.attorneybitcoin.com. I am interested in talking. Best: George D. Greenberg, Esq. |
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I would respectfully reply that a forum is a good place to start. You are wise to state that if someone is going to proceed into operation then seeking professional legal and tax advice is a very good idea. Thank you for bringing up AML issues. I have added that to the list. George D. Greenberg, Esq. www.attorneybitcoin.com |
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Dear Community: I have seen many creative and useful business ventures related to crypto-currencies. I continue to be impressed at how innovative the software engineers, developers, business persons and marketers are. In any crypto currency related business there are many issues to consider upon start up. I would like to list some important ones and seek input from others as well. 1. You may want to create a business entity such as an LLC or a Corporation, but don't assume that you need to do this. It depends upon the nature of the business you are conducting. For example if you are a trader of crypto and you do it only for yourself, it might not even be a good idea to create a business entity as it would draw attention from regulators, banks and taxation officials, among others. What you are doing is generally perfectly legal, and there is no need to draw attention to yourself. Just make your money and pay your taxes. However if you are opening a major operation, be it a trading platform, large mining farm, an investment service, a new coin, or other large enterprise, then you would be better off forming a business entity for credibility, asset protection, and taxation issues. The choice of States should be considered as well. I prefer Nevada for the clients I represent so that I may be the front line for any issues that arise. 2. I always advise that any partners be trusted, known, skilled persons. The fewer partners the better. This is not always practical depending on the size of the venture. Consider making others independent contractors rather than partners, with a set percentage that has a cap. You may also offer a hybrid deal, payment of value up front plus a percentage. 3. Have an attorney draft any contracts or terms of service. Work with the attorney to make sure that they reflect what you want. 4. Consult with an attorney regarding laws related to what you are going to be doing. It is possible to get the licenses and approvals you need on your own without the help of an attorney, but at least get input on the process as you go along. 5. If you are purchasing equipment do not be hasty. Study the supplier, look for reviews, and take delivery of larger orders in stages. 6. Many people are looking to mine lately which is fine, however it has been my personal and observed experience that mining is not as simple as it may appear. In addition you run risks of the crypto-currencies that you are mining dropping in value, hacking, companies going out of business, miners overheating, miners simply breaking down or arriving defective, power rates rising, and so on and so forth. Try to talk to those who have gone before you before you leap. 7. If you are trading coins, study the coins, go to the opening page, look at the last few pages of the thread, follow it for awhile, ask yourself if it does anything useful or better. 8. Owning a business that deals in fiat such as most ATM's or an exchange will likely require that you register with FinCEN and set up an AML compliance program. This is not as hard as it sounds but it is important. In general, under these circumstances, the higher the dollar amount, the more information you will be required to obtain from the customer. 9. Be patient with yourself and others in the process. Things of quality and value take time and effort. George D. Greenberg, Esq. www.attorneybitcoin.com |
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www.attorneybitcoin.comMy name is George D. Greenberg. I'm a Bitcoin and Crypto-Currency Attorney and have been for several years. Lately we have been getting a lot of communication from those who are having difficulty retrieving their Bitcoin and other coins from trading exchanges. It is true that the major exchanges have been tightening verification requirements. While this may be a legitimate reason to delay distribution until verification of identity is confirmed, it is not a reason for failing to promptly communicate with the customer. I have heard of ticket responses being delayed for weeks, months and in some cases, years. You do have legal rights regarding your coins held in these exchanges, but before you pay money to an attorney to forward your cause, be sure to consider the following: 1. Read the Terms of Service or any Terms and Conditions. This should spell out what you did and did not agree to when you opened an account. It could well place the burden upon you to do as they require in certain matters such as providing proof of identity or waiting certain periods of time in order to resolve a dispute. They could provide for mandatory arbitration or mediation. 2. Consider that some of these exchanges have been in business for quite awhile and have at least a basically good reputation. 3. Consider that the Federal Government in the United States has certainly been taking crypto regulation more seriously lately and that this may require the exchanges to re-tool certain aspects of their operations. These things take time as well. 4. Consider that these exchanges likely want to stay in business and they can't do that for long if they defraud people they serve. 5. If you can find a physical address for the exchange, send them a letter outlining your issues along with copies of the history if you have it. It's probably a good idea to send it certified mail return receipt requested. If you have done the above and still cannot resolve your issues with an exchange then consider hiring an attorney who is experienced in the crypto currency world to help you to resolve the issues. I appreciate your questions and comments. George D. Greenberg, Esq. www.attorneybitcoin.comGDGreenberg@aol.com8440 W. Lake Mead Drive Suite 112 Las Vegas, Nevada 89128
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www.attorneybitcoinExperienced crypto-currency attorney based in Las Vegas, Nevada. ATM's, ICO's, Trading Platforms, Mining Pools. Any business venture involving Crypto. Happy Mining. George D. Greenberg, Esq. 8440 West Lake Mead Blvd. Suite 112 Las Vegas, Nevada 89128 702 706 5221 www.attorneybitcoin.com
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Thanks for the article, can be useful to keep than in mind.
Anyway, aside the common sense and experience in the crypto, there's no way to prevent against scams. It seems to me that scamers are becoming better and better. Stay tuned and be careful!
Agreed. I second the suggestion about not leaving any larger amounts on trading exchanges. Don't become obsessed with any project, site, scheme that might seem to make you money passively. Watch your investments and always be aware that if a site gets hacked, you probably have no recourse. I like the idea of trying different mining pools, trading platforms or novel sites. Spread it out but go slowly. If you smell trouble pull your coin out. George D. Greenberg, Esq. Las Vegas, Nevada U.S. www.attorneybitcoin.com |
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That is a good step that lawyers can do imagine if they were paid for a service
worth $10,000 in BTC and once the price of the coin increase their income will also
increase for that service. My only question is how are they going to pay their taxes
for the income they had in Bitcoin?
As an attorney who accepts BTC I also run the risk of the BTC dropping in value. When I receive the BTC for my fees I immediately convert it into fiat and place that in my trust account. As I earn it and pay on it I declare it as income and then report it on my year end taxes. Best: George D. Greenberg, Esq. www.attorneybitcoin.com |
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Does someone know if there is any regulation regarding ICOs?
I have the feeling it's like jungle for now.
Hello, Remember what is considered a Security. Now for legal reasons, don't consider this legal advise. Do get with an attorney. These should be considered my opinions only because of ........ If the digital currency, token, or crypto or whatever you want to call it, 1) Is being backed by any commodity or asset. 2) If it is offering ownership in a company 3) If it represents a vote in the company 4) If the person or entity that acquires it is guaranteed a return on his or her investment. 5) If you use the word investment, that can upset regulators. 6) If you promise interest to the coinholders. Good Luck Well done Sir: Also consider whether the purchaser is looking for passive income, which could just mean appreciation in value, or whether the purchaser is going to take an active role. If the purchaser is investing to obtain passive income it is more likely a security. If it is a security then you have to be registered as such with the SEC and have their okay to go ahead. Not a small task. There are exemptions to being a security. One of them is to have only accredited investors. Best: George D. Greenberg, Esq. www.attorneybitcoin.com |
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I can only speak as to the Unitied States. If your BTC comes from a legitimate source, and once sell for fiat you declare the fiat as income and pay your taxes on it, you won't have problems. You should be aware however that the larger the transactions are, the more red flags come up. I suggest making smaller transactions, differing amounts at different times. Anyone who read about the depression in the 1930's understands that a "run on the bank" can leave the bank short as they have money invested. A bank, or a crypto exchange for that matter, is supposed to have enough funds or coins on hand to honor demands for withdrawal. If they do not it does not necessarily mean there is any fraud. I believe the legitimate exchanges can become overwhelmed or caught "in-between" and this could cause a delay. These are some of the reasons I suggest not making large demands all at once. Spread it out over time and vary the amounts. Best: George D. Greenberg, Esq. www.attorneybitcoin.com |
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Dear Crypto-Community:
Lately I have been receiving emails and calls regarding scams and other difficulties. Please read my comments below and make your own suggestions so that we may try to help keep people from getting hurt.
1. Do not keep any meaningful amounts of crypto currency in trading exchanges. Make your trades and then secure in a wallet. This is a fundamental rule that should be applied no matter the amount of funds you have that you cannot afford to lose but if otherwise, you can just go ahead. Issues still arise today on several users not getting their due forks in due time while some other exchange sites change their policies at will. 2. If you make large deposits or withdrawals from any account you are raising a red flag. You will likely find that the larger the transaction, the more identity information the exchange or wallet requires in order to comply with AML laws. This is something that most exchange sites always put in the KYC policies depending on how much you want to withdraw and trade in. Higher amount means higher information you must be willing to share 3. If the exchange or account is a smaller company and you make demand for a large withdrawal you may find that your withdrawal will be delayed. If the company is over-extended or a scam or ponzi then your account may be "frozen" and your demands for explanation go unanswered. Be sure of the exchange site you want to visit there are several ones that have proven themselves that you can choose from. 4. As to cloud mining, you do take more risks that difficulty will rise faster than the ability of your investment to give you a true ROI. This is also an area that seems to have more scams. This is the most lucrative scams, want to waste your money, this is one sure way to lose it. 5. If the company you have funds in does not have a verifiable physical address in the country that you live in, you will likely have no legal recourse for any rip-offs. This I will have to agree with you. 6. Be aware that fees in many exchanges and wallets seem to be creeping up. You may start with $30, U.S. in BTC and by the time it is sold and reaches your Bank as U.S. Dollars it is reduced to $22 U.S. This is key before you start shouting scam all over the place. In all this is something a newbie should read and digest before engaging in any transaction via exchnage sites as well as cloud mining services. Mere reading can save a lot of heart breaks. Great Analysis. Thank you for filling in some of the blanks and expanding on some of the others. Best: George D. Greenberg |
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Thank you for your kind words. It is quite precarious right now for newcomers. What is interesting is that most crypto-users do not want the government involved, that is until a person loses money due to fraud, then they say, 'There ought to be a law.' Due diligence, buyer beware, seek out advisers, and definitely question even the advisers. George D. Greenberg, Esq. www.attorneybitcoin.com |
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Dear Crypto-Community: Lately I have been receiving emails and calls regarding scams and other difficulties. Please read my comments below and make your own suggestions so that we may try to help keep people from getting hurt. 1. Do not keep any meaningful amounts of crypto currency in trading exchanges. Make your trades and then secure in a wallet. 2. If you make large deposits or withdrawals from any account you are raising a red flag. You will likely find that the larger the transaction, the more identity information the exchange or wallet requires in order to comply with AML laws. 3. If the exchange or account is a smaller company and you make demand for a large withdrawal you may find that your withdrawal will be delayed. If the company is over-extended or a scam or ponzi then your account may be "frozen" and your demands for explanation go unanswered. 4. As to cloud mining, you do take more risks that difficulty will rise faster than the ability of your investment to give you a true ROI. This is also an area that seems to have more scams. 5. If the company you have funds in does not have a verifiable physical address in the country that you live in, you will likely have no legal recourse for any rip-offs. 6. Be aware that fees in many exchanges and wallets seem to be creeping up. You may start with $30, U.S. in BTC and by the time it is sold and reaches your Bank as U.S. Dollars it is reduced to $22 U.S. I look forward to comments and suggestions. George D. Greenberg, Esq. www.attorneybitcoin.comLas Vegas, Nevada, U.S. |
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Dear Crypto Community: Offering a coin or token to the public for sale has recently become more difficult. The SEC has determined that if this occurs, and the purchasers of the coins or tokens are passive investors, then it becomes a security and falls under their jurisdiction. What does this mean? It means that you must first be registered with the SEC which means jumping through hoops and following rules such as creating a prospectus for the review of the SEC; registering with the SEC and many other tasks that will require legal expertise, time and commitment. Ignore the SEC at your peril. Unregistered securities sold to the public can lead to civil and even criminal consequences. There are some exemptions to being considered a security. These require study, scrutiny and for the most part should be handled by an attorney on behalf of the Dev/Owners of the coin or token. An exemption must be requested and approved. I hope this post makes Dev's aware that there are likely SEC requirements that they must follow for a public offering. My law firm will be happy to walk you through this process. Myself, George D. Greenberg, Esq. and my associate attorney, Huong X Lam, Esq., handle most areas of crypto-currency law and provide related business advice. We welcome your questions here. Please ask related questions only if you are either invested in crypto, in the process of starting, or well on the way to a crypto business venture. This particular blog is for problem solving and not philosophical issues. Happy Mining: George D. Greenberg, Esq. www.attorneybitcoin.com |
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Hello Kind sir. First of all I would like to thank you for taking your time to answer our questions on this forum.
I'm currently a NON-US Resident with family members being US Residents. A few years back we registered an LLC with the intention of exporting products to other countries but it never came to reality.
Present day Im putting up a project of investment with a few friends and family members and we want to start a very small BTC mining operation (around 6-10 machines). I am in charge of all the tech part of the project. But also have a few concerns regard its legal implications. We want to do things right from day 1.
First we were thinking of starting small mining at home. So questions comes to mind. If I start mining and im not a US resident should i declare taxes? is there a link or any info you can point me to so i can inform me a little better? The hardware would be @ my mothers house and she IS a us resident. So were a little bit confused here. Since im only going to be here for a few months but the hardware will be left ON up and running.
So, what would you advice? we were thinking of registering a company in which my resident family members can be in front and on that order I think we will have to pay our taxes regarding gain and losses for the company's mining. Is this the best option?
Thank you in advance for your kind attention on this matter.
Best regards,
Angel E. Gimenez.
Please reply to me privately at GDGreenberg@aol.com |
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In the US, if businesses were to pay each other with crypto, would contracts be enforceable? How would accounting of those funds work if you never cash out?
Any legal agreement/contract is enforceable I could write down on a piece of paper a contract of you paying me $20 for 5 sweets and I would be legally required to follow that contract too the letter the same as you. The above answer was not made by George D. Greenberg |
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