Hi guys!
We are planning to launch an ICO for our chatbot-platform.Since we are going to sell the service mostly for fiat fiat money we consider a buyback option as a way of returning profits to investors. We, however, do not understand so far if there are any legally or technically binding mechsnism that will guarantee potential investors, that we will do a buyback and thus raise their trust in us.
Maybe you can recommend something?
Thanx!
No there's no such thing and since this space is unregulated (thank god) investors will just have to trust you on your word. Also with upcoming regulations you might want to see if buy-backs are legal and if there has not yet been made any laws around this then you should add a disclaimer in the whitepaper to guarrantee safety.
Something like this:
''During the course of this ICO at: ''insert date'' ICO's were not yet regulated and no laws had been made. Therefore we can not guarrantee that all methods, practices and claims are 100% legal with future regulations and laws from: ''insert date''. We ''insert name'' therefore deny all liability and deny all responsibility regarding any methods, practices, actions and claims made during the ICO stage and developing actions and reactions from there on. We ''insert name'' also deny any liability and responsibility regarding any future projections, claims, mechanisms and actions that had not been restricted yet by rule or law nor regulations.''
Something like that, though I might miss a thing or two- three.
So buy-backs are not legal on the stock market. I know that short-term buybacks are illegal but long term buybacks are legal(I think..), some companies need to buy back in order to remain healthy and combat inflation. I know IBM did a buyback to not suffer from a declining EPS (Earnings Per Share). So if IBM did it.. then I suppose it is legal on long term. But short term buybacks would just be another insanely profitable scheme for investors.
A thorough and extensive legal disclaimer is a MUST!!
