As I have been telling everyone all along, crowdfundraising of this size without proper legal filings was illegal. Obviously, they have been contacted by the proper regulatory agencies. This is why they have not been responding to questions regarding their investment structure in a detailed manner. They are reviewing their proposal internally with their attorneys. You can all thank me for at least being a voice for good judgement and hopefully they will proceed in manner does does not put your investments in jeopardy due to legal problems.
We were never contacted by a regulatory body nor believe the models we have chosen are in any way in violation with relevant jurisdictions. This said, logistically and regulatorily, there are differences between raising 5,000 bitcoin and 30,000 in an equitable and fair way. We have a duty to those who trust us to do things the right way and have been in deep discussions for months about this topic with counsel from three different countries. I appreciate your concerns and they are indeed important to address and will be publicly once we announce the new fundraising date.
There are actually several models we could pursue if desired with some constituting a tax event without the need for any filing and others that could require one if we choose to accept certain jurisdictions. Ultimately, it comes down to what is best for everyone in the Ethereum community and what will allow for the best ROI for those who participate in the Ethereum Project. We are taking extra time to ensure this is answered in the most thorough way.
In the meantime, enjoy the testnet and all the other developments we will be launching in February and I'll see you guys soon in Zug.
Hopefully, regulatory issues are being worked out as promised as it will be one less thing to worry about, but I still stand with what I wrote earlier regarding the investment structure of the deal.
So far judging from the responses on all Ethereum forums here is what I see. Most of the people posting on this forum and almost all the people that were at the Miami Conference praising Ethereum are developers. There is genuine potential for this platform to be groundbreaking if done right. The devs that are shilling for the Ethereum to succeed have either been involved in pre-fund raising before and want to see this succeed for selfish reasons or they believe in Ethereum and are planning to monetize this platform in the future and want to see Ethereum succeed for selfish reasons.
Then you have the other half of the devs that are not involved with the project, see there are too many risks involved and fearful of wall street taking over the crypto industry.
Where I feel there is a severe disconnect is that the majority of opinions on this forum, Reddit, etc.. are developers and they will constitute less that 1% of the total amount of investment capital that Ethereum is trying to raise.
If you go to a Conference where the entire majority of reporters have a dev background, you are basically looking at the very definition of a biased opinion and reporting. Just because a small group of technology advanced individuals are excited about the possibility of the tech, doesn't actually mean equate a great investment.
Then you have the 99% of the general crypto population that are only interested in making a quick profit on this coin. They are not particularly interested in this new coin/platform and don't really care about the technology and only if there will be enough ROI to justify an initial investment into the pre-sale. Initially, there was a lot of hype on this coin that drew a lot of interest, but crypto investors cannot be duped. They realize they are not getting into this investment at the ground floor level and with the amount of money/bitcoin that Ethereum is trying to raise before launch, there will have to be 100 million dollar market cap for them to see a profit. Long-term is the only reason to invest. There are few pump and dump scenarios that will work with this investment structure that Ethereum is proposing because all the initial "pump" profit is being taken out of the market and into Ethereum's pocket right from the beginning.
Long term I see a lot of risks involved with pre-sale investment.
1/ There is risk of immediate loss of equity once it hits an exchange.
2/ There is risk of dilution
3/ There is risk of the company dissolving or bankrupting (however small)
4/ There is risk of this becoming vaporware
5/ There is risk that it will be forked and cloned
6/ There is risk that there will be too many security holes
7/ There is risk that a newer and better technology with greater funding and transparency will enter the market in due time
8/ There is risk that the altcoin (or platform if you want to call it that) crypto market will crash in a few years
9/ There is a risk (and I personally feel strongly about this) that the price will be considerably lower once it hits an exchange and falls to what the market feels is an appropriate price for the amount of risk and dilution involved with the project.
Of course, I could be wrong and Ethereum totally sells out and there will be another 100 million worth of btc bid aftermarket. But do you really think that crypto investors are dying to jump in to give anyone 100 million on vaporware on a diluted investment? ALL you have to look at is the forum boards and ignore the developers who are shilling for the product to succeed. There is a huge outcry against the current investment scheme. Why are people so vehemently against Ethereum's structure? Because they feel it has a possibility to be an asset to the bitcoin community but not the way its currently structured.
So in final words, whether you believe in the tech or not, all you have to ask yourself is this. Would I be better off investing in the pre-sale or should I invest aftermarket?
There is absolutely only ONE reason you should buy into the pre-sale, if you believe that it will be so much oversold and the market will not feel that it's diluted to the point where there is another huge group of buyers willing to take it off your hands and xxx times a return on your investment right from the beginning of launch.
Now I submit to you a few simple reasons why you should wait until aftermarket to buy-in.
1/ You NEGATE any risk mentioned earlier in the post and you only have to consider risk/reward. If I buy in pre-sale what risk do I take vs the reward I will have for taking that risk. Do you think there is greater chance that the market price will be higher than lower from the pre-sale price? And to what degree do you need to see Ethereum trade at to make this pre-sale investment worth it for you.
2/ Time value - What could have I done with this money invested in Ethereum that will be locked up from pre-sale until launch on a legitimate market. During those two or three months, you could have that money invested in Bitcoin (which has a lot less downside and at the current level has a good chance of increasing in value) or a dozen new altcoins that will be launching that as you can see we are in the midst of a crypto coin boom. How much money will you have lost by freezing your money up in Ethereum, when it could be actively invested in other more profitable ventures where the initial investment is not severely diluted?
3/ During the time you buy into the pre-sale (several months) and the time you are able to trade your ETH on an exchange, I guarantee you there will several new teams announcing a new platform or coin that will get much better press with a better investment structure. You take the risk of obsolescence even before the coin launches.
4/ By buying into the coin pre-sale and making it a success you encourage Wall Street to take over the crypto coin market and in the future you may see an environment where every new coin launch will be diluted and structured in a way that only Wall Street will increase their millions and the RISK will all be burdened by the crypto community. Ethereum will set a new precedent and if you think this will not happen, think again. Miners and crypto investors will be locked out of the early "pump" profits while Wall Street makes millions and we will take all the RISK. The early pre-sale investors will essentially be the bagholders.
5/ Here is the most important reason to wait until it hits an exchange to buy into Ethereum, you NEGATE all the risk I mentioned before and plus you do not enable this kind of launch in the future. There is a good chance that you will be able to buy it lower than the offering price of approx a dollar an ETH. and if the price rises a bit, you can still buy in at the pre-sale price or a little bit higher. The only reason you should be buying this pre-sale is if you believe that there is another 100 million waiting in line to buy ETH and there is no risk involved. You have absolutely nothing to lose by waiting and a lot at stake by buying and enabling this type of coin pre-sale launch.
Now, over the next few days I imagine Ethereum will hire a Marketing PR, they will hype and pump the tech and coin and gloss it over to make it look like they invented the wheel. They will cast out all the doubters and call them "FUD." Vitalik will come online and answer questions about the tech. But I say to you forget about all that. Don't get caught up in the tech, we all know the tech has the potential to be amazing. Look at the investment structure. Dont let Vitalik use excuses like this is the best way to avoid "whales" from taking over the market. That is so naive. Think!!! Regardless of the tech, is it more beneficial to me, considering risk vs reward, to buy pre-sale or buy aftermarket?
If you choose pre-sale, then good luck, all I'm asking you is to forget the tech and the chatter from the devs and focus on the pros and con of the investment only. Live long and prosper!!
