In the last month we were going through a lot of discussion based on our whitepaper so it is time to share more information about what we are doing and what we are not doing. We are thinking about how we streamline and standardize the full M&A process so that everyone can invest into companies also starting with small amount of investments. The blockchain is an enabler to further optimize and standardize this process. That’s why we are building up a protocol to shift the working crowd investing model to a completely decentralised and standardized protocol to setup investments into companies based on automated scalable investment products.
We develop a decentralized, regulatory-compliant crowd financing infrastructure protocol on the blockchain – the CRWD Network. In this first part we will look at the basis of what we do and will then share further information in the next posts.
The securities will be represented on the blockchain in the form of company tokens. 100 % of the company token represents 100 % of the investment offer from the company. If I own 10 % of the company token, I own 10 % of the investment offer.
As we are standardizing the whole process from signup to investment, we need a second functionality, we call it the company token generator. This is a small program running on the blockchain which allows everyone – who has access – to trigger the setup of his own company token without programming.
At the beginning, to give out the company token the first time, the smart contract comes in form of a crowdsale. This crowdsale contract is linked with the company token and defines when you can buy a new company token and when the same crowdsale mechanism will end. It furthermore defines what you have to pay in order to get the company token.
The last element of our protocol is the investor key. We see the current developments form the regulators in Europe, that say that everyone who wants to buy a security needs to be identified. The investor key is linked with a specific Ethereum wallet and serves as this identification mechanism, after the owner of the private key of that wallet has gone through a KYC process. This allows the CRWD Protocol to always know who owns which company token.
Having these elements setup, we are step by step creating a completely decentralised and standardised ecosystem to invest into companies the legal and regulated way.