I’ve noticed a recent increase in projects asking about the legalities of using our Nu logos in their products, most recently with a Canadian art magazine asking over Twitter. I think it is important to publicly clarify our legal stance on the use of our Nu logos - namely, that anybody is free to use them however they wish. The Nu network benefits from free advertising in my opinion.
The other issue that should be publicly defined is our stance on the legalities of NuShare distribution. It is very clear to me that the blockchain voting mechanisms available within Nu, along with the selective distribution methods used by Jordan Lee, make Nu a classic Distributed Autonomous Organization (DAO).
So, I’m proposing to create a new FAQ section on the website entitled “Marketing & Legal”. Below are the first two questions and responses. I welcome comments on both of them. I would also welcome additional suggestions of commonly-asked questions we could include under this heading.
Section Title: Marketing & Legal
Are NuBits and NuShares legal?
Each national jurisdiction will have its own rules and regulations regarding the use of digital currencies such as NuBits and NuShares. A decentralized blockchain like the Nu network does not operate within any one country. Users must exercise their own judgment as to whether the use of the Nu network is legally permitted within their country.
In regards to NuShares in particular, care has been taken to ensure that the structure of the Nu network meets the emerging definition of a “Distributed Autonomous Organization” (DAO). While there is no global consensus on the legalities of DAOs, a recent article stated:
Another use case that the authors view as less problematic through the lens of US law is the use of tokens to create distributed [autonomous] organisations (DAOs).
In this instance, tokens are used to denote membership in an organisation, with the user retaining the expectation that he or she may benefit financial[ly] from the ownership.
The report suggests that, in this case, token owners may have some control over fund utilization, “making them effectively managers and/or partners in the success of the entity”, a factor that makes them less likely to be viewed as securities.
”Depending on the nature of the organization and the actual control held by people who have committed capital, ‘shares’ organizations which are structured on the blockchain are likely not to be considered as securities,” the paper suggests.
It is important to note that all initial purchasers of NuShares were selected by lead architect Jordan Lee on the basis of being a potential business partner - someone who was capable of offering skills and abilities that benefited the Nu network. In contrast to public “Initial Coin Offerings” (ICOs) that other projects have attempted - where shares were sold indiscriminately on a public exchange - the initial distribution of NuShares was very selective.
As the article above alludes to, the unique custodial grant, parking rate, and motion voting mechanisms utilized by the Nu blockchain makes all NuShareholders “effectively managers and/or partners in the success of the entity” because “token owners have …control over fund utilization”.
Nu has no legally-recognized management, directors, or employees. It is a global DAO with no national affiliation. The Nu network will operate according to decentralized consensus of all NuShareholders.
Can I use the Nu logos for a product I’m making?
Yes. Our NuBits, NuShares, and Nu logos are free to use for anyone who would like to create products or services. Want to create a t-shirt, coffee mug or phone case? No problem! Be sure to send us a link to your Nu product on discuss.nubits.com. Our only requirement is that no verbal or written representation is made that your product is officially endorsed by NuShareholders or Nu core team developers.