A possible ECOBANK model for revision and feedback

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(Edited)

You guys are in this as much as I am! I need your help to look over this plan and give me some feedback - consider it your first act of governance even before the token sale.

ECOBANK tokens

So as chronicled here, here and here, we are moving forwards with a land backed project. The land is purchased, the legals have been investigated and there is now just some paperwork to finish up to get started with this exciting project.

I have created ECOBANK tokens to do the job, I have not issued any yet, as there is still the issue of the above mentioned paperwork.

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Exactly what we plan to do with this token must be explicitly set out in the founding documents of the legal entity we are forming. Which means that we will need to work out all the details first, translate them into spanish, found the company and then do the token sale.

So here is a model, an example of how it might work - and you brave governance participants, can give feedback right now.

Token Technology

The token technology that we are using is the hive-engine protocol, token smart contract code available on github, here is a link to the github wiki page for all hive-engine code.

These tokens will represent shares in a Colombian company with the stated purpose to make a hotel and further develop productive projects with the land that will be the equity of this common enterprise.

The token precision can be from 0-8, and we are looking into the consequences of fractional ownership, but it is our preference to have 8 decimals of precision (the most precise).

Pre-Sale

If we assume that the tokens will represent some dollar figure, it might make sense to sell them for HBD. LTC has also been proposed as a funding mechanism, and of course HIVE or BTC could be used at some sort of dynamic conversion rate to lock in some amount of dollars for initial phases of development.

In the Pre-sale we would sell up to 100,000 tokens at $1 dollar each.

We will use the dollar value raised to build out the basic infrastructure of a resort - hotel, with room to expand later. Locally we can recommend many great destinations once tourists are here, and even on a local level there is a perceived high demand for this type of service.

Token holders participating in the pre-sale will be the very first members helping to make decisions from the beginning of the process, including helping to make suggestions on building designs and other choices that may come up in this process.

And of course as members they will be the first to enjoy any special benefit that will come from being a 'resort owner'.

Any tokens not sold in the pre-sale will be held for later funding rounds, to be approved by members, at a price of no less than $1 dollar, likely higher.

Membership levels

At this time I need some feedback from those interested in participating in this project. There are many thoughts to consider with 'levels'.

First off, as per the relevant law, all token holders (share holders) have rights, and that means and includes rights to the split of the profits (after costs, etc). So to the extent that the technology permits it, we will be paying dividends to all token holders (no minimums).

Secondly, the rights of governance are to be voted on in a stake weighted fashion, but any sized member can submit a petition. I am looking at the possibility of using an implementation of ARCHON's Governance Suite.

In this case, some percentage like 0.001 of governance would likely be the minimum to participate in governance decisions.

Bonuses

In terms of bonuses, discounts to using resort and hotel services are definitely on the table, with a caveat that using these benefits would always be on an RSVP basis. We will need to do some calculations about capacity and profitability to make sure that the project will not lose money but can give back as much as possible to members.

Land Equity.

The land and any improvements will be matched to tokens at the pre-sale levels, probably 1 dollar per token. These tokens will likely be under some sort of time-lock, such as 10,000 tokens released every six months.

Example:

Let's do an example to make this all more explicit.

The land is valued at $60,000 dollars. Of 100,000 tokens for sale, we manage to sell 60,000 of them and distribute that on hive-engine.

10,000 tokens are distributed to @ecoinstant, and 10,000 tokens every month for each 6 months after that. I may choose to sell some of these tokens, but not until after the pre-sale is finished.

With $60,000 dollars, we will produce a design and build out a resort/hotel. The first and most important will be sleeping infrastructure, such as common sleeping room, common living room and several private rooms.

Secondary considerations will be the paths and development of the land, with some options to decide whether to implement medium or long term crops into the design.

Token holders will be legal owners of this land, and if for any reason the project is cancelled, they will be legally entitled to the liquidation value through their hive account on record.

After phase one construction is complete, we will analyze our position, cash on hand, and needs moving forward, and can possibly sell more tokens if it is decided that we need more investment to expand our offering. At this point, after expenses related to site management, profits will be split amongst the token holders.

What do you think about this plan?

Is it clear? What details need to be further clarified? Thank you for your help!

Freedom and Friendship!



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15 comments
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Maybe screen possible holders and not sell the stuff on engine readily?

I'm not sure if I understood the legal stuff right but what if there were legal consequences that required an anon holder to be accountable for just holding a token and laws to ownership with its responsibilities may be in conflict with the owner's country origin. And in events where ownership is passed on frequently by trade, does the account take a snap shot of its holders within a specific period and must hold x amount to qualify for dividends?

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I agree with this.
I love the Idea but as token holders where do we stand if the endeavor fails. Will token holders be held accountable?
If bankruptcy occurs will Token holders be asked by the government to help pay any outstanding money?
These are things we need to know before investing.

I personally love the Idea. I would love to see this become a great success story. Just have to make sure we all know what we are in for before investing.

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Limited Liability protection will be given to all holders, so 'only can lose what you put in' does apply here.

The land does back the tokens so even if we decide to stop, there should be some value locked to give back to token holders. Hopefully we will not have to go into debt of any kind.

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I believe we have a solution to your issue in this post, please review and give more feedback! Thank you!

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To support your work, I also upvoted your post!

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Thisis a hard teretory, i have been thinking long these lines but with rented out real estate (solid but slow div´s compared to the 100s of percentage demanded on today).
It´s real cool that the legal documentation and evrything surrounding it went smooth.

Since no tokens have been issued, i am talking only from a perspective of a friend when i say that the plan looks awesome, and if it comes to fruition, how it would beacon the strenght of decentralization.

I hope to buy some tokens when available, i dont have any hard criticism, but in these matters being as clear as daylight always helps. Leave no room to "misunderstand" a thing, and you are good too go!

Best of luck in your endeavours.

Eythorphoto

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I am in this one for all that I can get.

Might I also suggest exclusive golf course as well?

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As a complete newbie : how will you manage the "value" of the token ? If it is available on the hive engine market, it will be subject to offer and demand, won't it ?
It means it could be a wonderful investment if you succeed (and that's all I wish you ;) ) but it will also be subject to speculation, and this could be problematic for you. What if the value of the token dramatically goes down ? You won't have money to build the new infrastructures ?

On the governance topic: maybe there should be a "ownership limit". What happens if one person owns all the tokens? Practically speaking and legally speaking ?

As said by @adamada, is it good that anyone can have a share ? I've seen a lot of very nice projects that relied on communities getting out of hand (Warmshowers, Couchsurfing...), due to power balance shift or even simply greed.

Maybe you did it already in the paper work, but you should have some kind of "golden share" (like countries for certain companies) or "veto right" (like the UN permanent members). And have a first circle of screened owners that would act as board members. Then the rest of the owners would act as general assembly.
This would need to write rules on what can be decided by the board, what needs to go through the assembly, etc...
Having a board with a fixed number of shareholder would also prevent someone from having "too much power".

It's just my 2 cents, but my main concern would be the balance of power in the decision process. You'll need strict rules to ensure this balance.

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Great suggestions - here's a few thoughts -

1- token price on the hive-engine market does not matter. it will be subject to demand and offer, so could be higher or lower than the actual asset backed value represented by the token in any single moment.

2 - Asset backed value will be calculated periodically, not sure how frequently we can do this, clever investors will hopefully try to buy under this value and sell above this value, so the market mechanism can work to stabilize the token price around the ABV (asset backed value).

3 - I like your governance suggestions, a veto share is clever, though in my eyes likely to be had not by token investors but by the team here on the ground.

4 - check out the latest post and keep giving your feedback! It is greatly appreciated!!

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Thanks for the clarifications.

Concerning 3, maybe I was not clear enough. When I mentionned the golden share/veto right, I meant YOU should hold it (or as you said, the team on the ground).

The idea of a "board" was there to protect the project a bit more and maybe smooth some decision processes that have to be made faster than usual.

I'll have a look at your new post at my lunch break ;) Duty calls !

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