• The security of investor funds during a capital raise is key. Are funds held securely? If the funds were raised in cryptocurrency, is the value secure? What will be the value of investor funds in several months, once the raise is complete?
These are the questions all ICO companies and funds need to be asking as they contemplate their raise. Without answers to these, capital-raising companies can be faced with problems from the S.E.C., potential investors, and institutional funds, all of whom will demand safekeeping of currency during the raise.
Paladin’s ICO solution meets the needs of the S.E.C. and the most savvy, concerned investor.
• As investor funds are sent in digital currency, they are received not yet by the company doing the capital raise. Funds are sent directly to Paladin Trust’s cold storage solution, providing a greater sense of security to investors from the outset.
• At the Company’s/Fund’s direction, Paladin’s traders hedge all digital assets to the USD upon receipt of the funds, to shield companies and investors from the volatility of the crypto markets, thus eliminating market fluctuation risk during the fund-raising period.
• This benefits both the company and the investor, as they each receive the intended value/benefit of the investment.
• Once the fund raising efforts are completed, Paladin company’s funds are released at the $ value rate that was originally received. That means if your company set out to raise $100 million, you actually still have $100 million at the end of your raise, not a fraction due to market volatility.
• If, for reasons out of your company’s control, the capital raise must be paused, postponed or changed in any way, having a custodian may mean the difference between legal exposure or not. Investor funds can be easily returned, value intact. The legal exposure for companies not using a custodian, should timing or terms change during the fundraising, is extreme.
• After the successful raise, Paladin can continue to hold the funds (either in crypto or in a hedged position) and distribute them to the company based on the company’s liquidity needs.