> There must be reasons other than "VCs are greedy!" for employees not being able to sell off their stocks immediately.
Well thats not what I said, so I don't know where you got that from. Strawman much?
I said there are legal problems for selling stocks... of the privately held company variety if that wasn't clear. Those legal problems aren't stipulated by the VCs, well, at least one of them is, but it applies to them as well. The others are from the federal government. I'm not going to bother writing a dissertation on that.
VCs have many ways of getting their money back, and many of those ways are at the expense of employees even if they bought their options.
> The most obvious way to abuse this would be to join or create a startup, go through the ICO process, then sell off your shares, and, well, exit
What? Just to clarify, are you conflating ICO tokens with equity shares? Or saying something like "your share of the ICO"?
> You're rich, now - why keep working to build the product you (or your boss) promised to deliver?
This is where the consumer and investor protection concerns come from right now from various regulator perspectives. ICOs are much like Kickstarter, the answer is you don't have to deliver. Reality is also much like Kickstarter, people have a dream and want to deliver. People do deliver. People that have never touched millions of dollars in their life, go out and play business person until the money runs out.
Many technical dreams that wouldn't fit into a VCs portfolio are able to get funded now. Thats really all it comes down to.
People put their reputation on the line. That doesn't mean much to all people, and they have bad reputations now.
There are several advantages in the ways to mitigate these risks. First, these communities come with a big open source culture. If the team starts messing up, there are still ways to contribute or even carry on the project, a lot of the times. Most of the projects have a big decentralized component to them, which does enable others to carry the baton.
Secondly, the token obtained in the ICO has an exchange rate. You, the buyer, are able to exit your position while a market still exists. Most coins, even "dead" ones, have a market, or CAN have a market. Even if they have their own blockchain, they can be revived with the participation of just a few computers, and exchanges will list them.
Well thats not what I said, so I don't know where you got that from. Strawman much?
I said there are legal problems for selling stocks... of the privately held company variety if that wasn't clear. Those legal problems aren't stipulated by the VCs, well, at least one of them is, but it applies to them as well. The others are from the federal government. I'm not going to bother writing a dissertation on that.
VCs have many ways of getting their money back, and many of those ways are at the expense of employees even if they bought their options.
> The most obvious way to abuse this would be to join or create a startup, go through the ICO process, then sell off your shares, and, well, exit
What? Just to clarify, are you conflating ICO tokens with equity shares? Or saying something like "your share of the ICO"?
> You're rich, now - why keep working to build the product you (or your boss) promised to deliver?
This is where the consumer and investor protection concerns come from right now from various regulator perspectives. ICOs are much like Kickstarter, the answer is you don't have to deliver. Reality is also much like Kickstarter, people have a dream and want to deliver. People do deliver. People that have never touched millions of dollars in their life, go out and play business person until the money runs out.
Many technical dreams that wouldn't fit into a VCs portfolio are able to get funded now. Thats really all it comes down to.
People put their reputation on the line. That doesn't mean much to all people, and they have bad reputations now.
There are several advantages in the ways to mitigate these risks. First, these communities come with a big open source culture. If the team starts messing up, there are still ways to contribute or even carry on the project, a lot of the times. Most of the projects have a big decentralized component to them, which does enable others to carry the baton.
Secondly, the token obtained in the ICO has an exchange rate. You, the buyer, are able to exit your position while a market still exists. Most coins, even "dead" ones, have a market, or CAN have a market. Even if they have their own blockchain, they can be revived with the participation of just a few computers, and exchanges will list them.