Although INLOCK has conducted one of the most successful tokensales in the fall of 2018, we simply can not ignore the recent events – as we have stated in our [previous post] the SEC has significantly changed the regulatory landscape in regards to the cryptocurrency market. Not only it is providing strong statements about ICO-s and Exchanges – whilst there are now 2 cases of precedence for projects issuing tokens – complemented by the ruling against Etherdelta does not sanction the operation or fundraising of INLOCK any immediate way – sets a quite clear path for the future of cryptocurrency regulation which we can not ignore.
From day one we promised INLOCK to be operating in a fully regulated environment, creating a safe and level legal framework for all platform participants. During the whole existence of INLOCK we have been transparent on what we do and why – this is exactly the reason we are communicating the effects of the recent events on INLOCK. To those who are present in the cryptospace for more than a year in the sea of false promises and fraudulent ICO-s the following might come as a surprise.
After discussing the matter with our advisors and listened to our legal counsels we are certain that there is a bright future for INLOCK as a project since the foundations we built our project on have not changed. The demand for crypto collateral based lending services is clear. The service and the unconventional way we designed our platform were bound to push the boundaries of traditional regulations – we were prepared to having to make certain adjustments accordingly.
During the extensive deliberation we came to the following conclusions:
- The best course of action is to stop our token sale effective immediately
- Offer an optional full refund for public sale participants
The decision may seem severe, but it does not affect the technological roadmap as we have the necessary funding to develop the INLOCK platform thanks to the funds from our earliest investors. Practically what this means is that we will set the project to an organic growth trajectory, rest assured lending is and always have been a profitable business.
The token market will be released soon, although there will be limitations aligned to the latest regulatory shift. This requires a slight redesign and testing from our side, but at this point, we do not see a reason to delay the release much further.
The majority of limitations and changes to the token market are necessary because of the classification of ILK as utility token, while removing factors that would support a case of it being a speculative asset:
- Tokens purchased on the token market after the conclusion of the tokensale are not movable to external wallets, however they can be sold on the token market
- With the basic KYC required to use INLOCK matching service the sell limit of ILK tokens is: 1000 USD
- This limitation is not applied to users who deposited and applied for loans as they are required to complete the independent strong KYC during the loan application – their upper limit is determined by the value of their deposit.
- The maximum duration of sell orders is 24h
In compliance with regulations, we will not facilitate our token to be listed on any 3rd party exchanges, although it will probably happen soon after the tokens are unlocked, without our consent or direct activity from our side.
As a startup aiming to be one of the major cryptocurrency related businesses it is certainly hard to give up a major part of our funding, which would have made it easier to reach our goals, we firmly believe that this decision the right thing to do, and we are certain that will be able to compensate this with dedication and hard work from our side, while retaining the trust of our community.
The purpose of this message is to provide you with our situation assessment and to let you know the recalibration process of the project that is necessary in light of the recent events. Decisions like this do not come easy as we have the utmost respect for our supporters. Nevertheless, this is a major checkpoint – that is why we provide you with the option of either come with us on the road ahead or ask for a refund should you reconsider your earlier decision. We will make the technical conditions available for you to be able to ask for a refund the soonest. The refund period will last for a full 30 days and requires the tokens to be transferred back, and a manual confirmation of the refund request.
The refund period starts on the 25th of November and ends on the 24th of December. If you decide to request a refund, please fill in the refund questionnaire form [HERE]. Please note that you will need to transfer your ILK tokens back to be eligible for a refund. We are only able to transfer any contribution to the same address/bank account that the funding was originated from. Before you request your refund please make sure you still have access to your wallet. Only accounts with fully completed KYC are eligible for a refund.
Those, who do not request a refund during the announced period express their consent to keep their purchased ILK tokens and acknowledge the fact that ILK is a utility token it can only be used to access the proposed services of INLOCK platform, and holds no additional perceived value.