What documents should be posted on the blockchain project website

Elena Mashina

Contents

The world of traditional finance is changing dramatically. Now entrepreneurs and investors are involved in projects based on blockchain technology. Such projects, as a rule, are aimed at raising funds to create a new unique product. Due to the growing popularity of such projects, states began to create a legal framework aimed at leveling the possibility of money laundering. That is why it is very important for companies launching blockchain projects to carry out compliance procedures and post the necessary documentation on the project website.

White paper

As a rule, at the stage of development of any blockchain project, it is the White paper that is created first, which contains all the basic information about the project and what persons can take part in it. A white paper is a document designed to convince people to support a product, service or idea and invest in it. It should contain information about how the idea of ??the project came about, what it is aimed at and how these goals will be realized. The description should include detailed information about the product for the development of which the creators want to attract investment, as well as a roadmap or instructions for investors on what requirements they must meet in order to join the project.

Terms and conditions

The User Agreement (T & Cs) is close in content to the White Paper and is an integral part of the legal structure of any blockchain project. An ICO white paper, for example, is presented at the top of the project's landing page. T & Cs tend to be a link at the bottom of the ICO website, and investors often acknowledge them by clicking “I Agree”. This document is not always studied by investors; they have already found all the answers to key questions about the project in the White Paper.

The user agreement is a legal agreement between the project owner and the investor.

T & Cs may include opaque clauses. For example, in the terms of the Tezos project, the purchase of tokens is called a “non-refundable donation”.

If there are no rules and conditions on the ICO website, this in itself is a trigger for financial regulators of the jurisdiction in which the company for the blockchain project is registered.

Key points that should be reflected in the User Agreement:

Parties to the agreement. Even in the first paragraph of the document, it should be clearly defined who and with whom concludes an agreement. In most cases, the buyer should see the official name of the legal entity on the document.
Token definition. The user agreement can refer to the White paper, where the definition of "token" is given. In this case, the User Agreement must contain a hyperlink to a specific section of the White Paper. Speaking about an ICO project, an investor should see in the legal documentation of the project what the issuing company "promises" to him after making an investment.
Terms of token sale. The user agreement for an ICO project, for example, should include provisions on the prices and timing of the sale of tokens. This information should be available on the landing page of the ICO website.
Use of investments. ICO was successful, what's next? The terms and conditions should include the issuer's plan as to how the proceeds from the ICO will be used and at what point the investor will be able to receive the promised benefits.

It is very important for an ICO project to have a template for a token sale and purchase agreement. It is not always placed by companies in a separate file, and often the terms of the token sale and purchase agreement are already spelled out in the User Agreement. For example, entrepreneurs who launched the HEROIC Ecosystem project, developing the legal basis for the project, decided that all conditions for the sale and purchase of tokens will be spelled out separately - in the Purchase Token Agreement (https://heroic.org/token-purchase-agreement/).

Cookie policy

The cookie policy informs visitors of the blockchain project site what cookies are for, what data the site collects and how it uses this information. The policy should also inform potential investors / users of how they can opt out or change their settings.

The cookie policy is legally binding under the GPDR (General Data Protection Regulation) and the CCPA (California Consumer Privacy Act - the first comprehensive privacy law in the United States). Those who start a blockchain project should know exactly what cookies and other tracking technologies work on the project site and indicate this in this document. As a rule, site users agree to the use of cookies by ticking the box “I agree (agree)” in the drop-down box.

AML / KYC Policy (Anti-Money Laundering Policy and Know Your Customer Policy)

As we mentioned in the article "How can crypto companies comply with the AML requirements?" obtained by criminal means, legal form.

KYC or “Know Your Client” is a certain principle of activity applied to all financial institutions (banks, stock exchanges, bookmakers, investment and mutual funds, payment systems, etc.), obliging them to identify the identity of the counterparty / client before conducting financial operation.

Confidentiality policy / Privacy policy terms

In the course of its financial activities, a company inevitably faces the need to process and store personal data of its customers / investors. To ensure that the personal data of persons participating in the activities of the company or using its services will not be transferred to third parties who are not authorized to process such data, a Privacy Policy Terms are created. The document lists those personal data that will be collected by the company for security purposes; indicates the measures that the company is taking to maintain the confidentiality of personal data. Also, the document must necessarily contain a section on the legal regulation of the collection, processing and storage of personal data in the jurisdiction in which the company operates.

Thus, we made an overview of those documents that must be posted on the website of any of the projects using blockchain technology and conducting operations with fiat or virtual currencies. This package of documents is mandatory and forms the legal framework for the functioning of the blockchain project. Each jurisdiction will have its own specific requirements for the preparation of these documents, therefore, in order for them to be drawn up on the basis of the current legislation, it would be a reasonable decision to contact qualified lawyers of Law Firm A4.

So, the following documents must be posted on the blockchain project website:

White paper
User Agreement + Token Sale and Purchase Agreement (for ICO project)
Cookies policy
AML / KYC
Privacy and personal data processing policy