First of all, it is fine to have differing opinions. I won’t even address some of the points here.

However, just to be clear: a superbowl ticket has a value in itself even if the person selling it to you disappeared (say Ticketmaster). This value (entertainment by watching a game and being allowed on the premises) is not dependent on the future success of the company selling it to you. More importantly, if the ticket was sold to you with the promise that you could later immediately sell it on multiple exchanges as a main value proposition and the main reason anyone bought these tickets was that you can trade them later (ie this “trading” becomes the major product feature), I believe it would actually be classified as a security. That classification is based on not only equity-like rights, but rather on showing sufficient characteristics of a security. But the great thing is — you don’t need to believe me:

SEC Chief Clayton: “I have yet to see an ICO that doesn’t have a sufficient number of hallmarks of a security”


Again — it is fine if you have a different opinion, but I do not believe the SEC chief could have been clearer. The current generation of ICOs clearly are securities.

In any case I have read your article on the Fortitude Ranch token. I find the argument compelling, but to me the key question would be whether during the ICO you promise to list the token at multiple (or one large) exchanges and whether people buy it for your product or for that possibility to trade. I think you can make a great point that they are buying it for the product in this case and as it is a ticket to your ranch (basically), it could well not be a security. Again to me that would depend on whether you offer to simply find a new taker for the ticket at the same price or a higher one if the price on your ranch also rose (which is what happens to most official re-sale tickets to events; they usually are not even officially allowed to be sold through other channels) or whether you apply to a number of crypto exchanges directly.

Note that you are saying “one can design an ICO that is not a security”. I agree. However you are writing in your answer to my article that I am wrong about ICOs today. Yet I think that’s true: 99% of ICOs today are very different from your token and they absolutely have “trading on an exchange” as their main value proposition but no real future product use. The SEC chief seems to agree. That does not mean you cannot design an ICO that is not a security of course.

Thank you for your opinion.

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Entrepreneur, Fund Manager, Ex-Consultant and Hobby Ice Hockey Player. Child of the Sun. Any opinions personal, never investment advice, sometimes parody

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