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Jake Chervinsky
@jchervinsky
1/ As U.S. regulators continue their war on crypto, many founders are thinking about geofencing as a compliance strategy. It can work, but only if it's done right. That’s why @dbarabander and I wrote this Practical Guide to Geofencing: https://blog.variant.fund/newsletter-legal-regulatory-affairs
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Jake Chervinsky
@jchervinsky
2/ Our guide explains what you (and your counsel) need to know about geofencing. Geofencing means stopping people in a certain "geography" from accessing a product by creating a virtual “fence” around it. We start by explaining when it's useful as a compliance strategy.
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Jake Chervinsky
@jchervinsky
3/ Geofencing is essentially a “when all else fails” fallback option when a company can’t: - satisfy applicable compliance obligations, like registration, disclosures, KYC, etc.; or - design the product in such a way that no compliance obligations apply in the first place.
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Jake Chervinsky
@jchervinsky
4/ Geofencing is useful when neither of those options work. It’s a pretty extreme solution to the problem of regulatory uncertainty — completely abandoning the US market — but sometimes there’s just no other way. We then do a deep dive into the case law on geofencing.
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Jake Chervinsky
@jchervinsky
5/ The guide ends with a summary of best practices for companies and their counsel to consider in establishing an effective U.S. geofence. It also gives suggestions for how to implement each one.
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Jake Chervinsky
@jchervinsky
6/ Special thanks to @ohaiom, a true expert on geofencing, for his review and feedback. We’ve been getting many questions from founders at @variantfund about geofencing. We hope this guide helps them and their counsel decide how it fits into their compliance strategy ✌️ [end]
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Monteluna
@monteluna
Would just like to pause and appreciate how I remember in 2005 people still thought the internet was a fad. Now, an internet distributed data type that registers public keys and some associated digits, is now somehow regulated by the SEC as literal investment contracts, so now website access needs to be approved by financial securities regulators. I have opinions about this but it's quite funny how some data online now has this power.
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