How to structure an Anon project without ending behind bars?

Transcript

hello everyone thanks for being here for the last panel of the legal track um it may be the the most easter interesting one if you are if you're a degen or crypto crypto fan we will talk about the the anonymous project what is an anomalous project what is a legal challenge to run or to launch an animus project and and and all the things relating to it to talk about it we have three very different and interesting people i will let you introduce yourself maybe simon if you can say what about you yes hello everyone simon paolo i'm maybe the more

regulatory guy of the panel i'm a lawyer i've been working with aidan the french crypto assets association and also uci european crypto initiative which is basically lobby crypto lobby at the eu level and [Music] yes so my name is trian butulu i've been involved in space uh for uh quite some time i'm uh involving curve uh the auto market making uh unstable coin now crypto assets uh

blackpool the quant for the nft market where we invest in the nfd market and we ran esport vertical to create yield on this vertical on this assets vector news the underlying dark side investigative firm where we analyze the market we uh study the acts and different things and we also throw some amazing parties uh and it's the capital which is the uh it's a it's a found uh family office plus a quant so we build a different defy tools in the space and hello everyone thank you for inviting me to this risky panel and as part of the ave legal team in the

room so i'm a bit sweaty right now but that's going to be a great experience i'm sure so my name is mark zieler i'm the head of developer relation at the ave company the ivy company is a web3 studio contributing open source software to decentralize protocol one of them is the ava protocol so basically what we do is that like most the most recent example is that we as the ava company develop the software of the ghost stable coin and we presented that to the other governance with the go proposal and then the decentralized protocol shall decide if they accept or not to onboard this piece of software

thank you for this introduction so i'm william o'rourke i'm working at orwell and i will try to moderate this panel if it's possible uh you can sit if you want uh in front if you don't want to stay on the back of the room um okay so let's start maybe let's start with a with a philosophical question why why why being anonymous i mean as an individual and as a project can be can be understand as the epitome of the crypto i mean why there is so much anonymous anonymity in crypto and why it's so well seen crypto industry maybe mark you want to answer this question um the first thing i want to say is that we value privacy like privacy is right and if you use the internet anyone in this room for less than 10 buck can

probably buy your personal data on the darknet that's the fact if you want to protect your user don't collect their data that's the best and most efficient way to protect your user is to limit the data collection privacy the right privacy should be valued and crypto and the ethos of decentralization is very compatible with the unknown culture and we think it's a good thing you want you want to add something um i don't think like uh to be the devil advocate uh i have to choose between the legal and on this side normally on this side so i will try to balance the the discussion i don't truly believe that users are

becoming unknown because of privacy i think most of the people that are on is because of they want to build a project and the regulatory system is not necessarily built in their favor so they choose the anon aspect and the the the default space is easy to build any projects from any place in the world and you don't need to ask requests to ask permission so uh being island uh has nothing to do with privacy for me it's more like people can build a project make money without necessarily answer regulatory uh questions if there is a show happenings like for example being listed on elected news so i think that's the main main aspect

of being iron in this space yeah i would concur with this uh analysis it's more that because of crypto can because crypto is the only space where you're basically allowed to create a project from the beginning through the end whilst remaining anonymous it's the only place the only space where you actually can do that and create really meaningful financial products that really have a big impact so that's basically a way to build without bothering yourself with all the legal teas but at some point let me we will go through that later is it really viable in the long term

that that's an open question very interesting before before continuing maybe let the door open and if you want to move on the front of the of the room to sit to sit here on the side because i see a lot of people on the back so [Music] yeah i think i think we have we have gained the right to be on main stage next year thanks to you um okay so we understand two things first uh anonymous it's anonymity and privacy is very valuable in crypto industry especially on the defy secondly crypto have lowered the farming it's technically possible to work and pay someone without knowing his identity so it's very interesting we are in a legal track so there have to

be some pain uh so i i'm turned to uh to simo is it possible legally to do something anonymous or or being anonymous means you will be always outside of the legal system or the so um there's no law that says that you cannot do a project without remaining anonymous what but there's so many issues with doing that that it's practically well it's not impossible of course it's people are doing this but it creates a lot of friction and a lot of legal friction um the the most simple one being uh you are

collecting money uh from people not identified you're not identified you're not supposed to do that um and so and when you are paying people it creates issue when you are creating ip or something that you want to protect it's creating issues so of course crypto has a lot of things that goes around that and you can still build something but creating a nano project and remaining completely unknown throughout all the the functions of your project and being 100 legal it's probably not possible even even today when regulation is not finalized and will probably not be possible at all in the future but that's something we'll

we'll go to later i don't know if someone wants to react to that coming back to the the the first uh part of the discussion i think there's an interesting statistics that we can run but on raked news i think in the space there's not a single project that has been running by anna that hasn't been wrecked so the point i'm trying to say is there's a correlation between um yourself putting the reputations of what you're working on and the anonymity of uh what you're trying to be in a sense that if you want to be an enough the only project that i think hasn't been wrecked as annan is uh bitcoin

satoshi nakamoto but then the ontario ecosystem of d5 projects all those annan project got wrecked because at some point uh since it's easy to build projects without necessarily asking or being accountable for uh for people getting wrecked or for going on in projects um then it's pretty big big issue so for me i'm always like suspicious and scared of using an anon project because why don't you put your reputation at stake uh in a space where you're using smart contracts and it's always a red flag for me obviously we don't we shouldn't put everyone in the same box but in this space reputation is big big and if you're building a device project and

want to be add-on it should be like a really clear reason for that for example building a protocol that you don't want this protocol to be stopped but be the foundation of other other projects but as a project it's kind of complicated for me the reasoning of being hannan at least as a leader of the project okay it's very interesting so two things first of all just to to explain you of course how to structure legally on a non-project it's a fake question because it's the idea it's not to structure it at all uh if you do not structure it at all if you want to remain anonymous we will give you and just start about it we will give you the main risk uh we have see the risk of of course of rack pool scam or wrecked i

mean in every way i mean it could be contractors to project project to users between users also there is also a risk uh see more you you start to talk about it maybe you can give us more insight if you are earning uh cryptocurrency as a developer for instance anonymous developer it will become increasingly difficult to cash out because uh maybe the banking system will ask you where this money comes from and there is a risk of laundering yeah well if you are struggling your project as an unknown project you will be you will have to be grassroot crypto and you don't have to think about cashing out because it probably won't be possible um you you will lack all the necessary

uh justification and all the necessary identification that are part of the financial system today so basically uh creating an unknown project is pushing you out of any chance of being regulated or being even interconnected with the regulated system and that's something you have to have in mind when you create an anon project and that would be my two sentence it's a choice mark you want to add something maybe uh yeah so that's the risky part i guess so i want to start to by saying that i spent some time in law school but i'm not a lawyer so nothing i'm saying from now on is uh

like legal advice or whatever because i do have spent some time in law school but i decided to do something more productive with my life at some point so i'm a dropout thanks mark it's very nice [Laughter] so i think we will leave now i guess the elephant in the room is that some people in the ecosystem not all of them uh on top of valuing privacy are choosing to be unknown because they are choosing to deploy products that are regulated or sometimes illegal and they think and i think that's uh

that's uh that's not the best strategy because decentralized ledger that by nature will store all transactions forever is the worst technology ever to do these kind of things but whatever i think the main issue is that if you want to limit legal risk be as decentralized as possible you cannot have the cake and eat it too if you want to create products that are truly decentralized be truly decentralized and you will limit your risk that doesn't mean that the risk will disappear completely that doesn't mean that it's a free card i'm completely decentralized so nothing can happen to me i don't need to be a nun

but you can you cannot have both you cannot pretend to be decentralized purpose uh services and tax directly as a human being fee from a protocol or directly proposed services that you have direct control over it and i think that's the main point is that if do you need to be alone if you are truly decentralized interesting maybe one short question very basic uh do you know could you tell who can you give us the name of one good and on project you said that a lot of a lot of them have been wrecked but maybe one of one of them as an example for people who want to stay or to

to become a nun uh well i mean the biggest and on project is bitcoin obviously um d5 um difficult it's difficult to to gudge hand on project because some people are on i i know them myself so it's uh and uh the anonymity has got some limits and if you want to do some deals and at some point those projects that either become successful they those people they also have these um paradox of uh being anon but also want to tell the world that they are behind those projects so it's at the end like they're not add on to everyone uh who's annon in a room [Laughter]

yeah so see you guys a few few different projects but none of those projects that i don't i don't know the people names so it's difficult to my side but maybe you know some project like yeah so there's several good examples in the ecosystem most of the year team for example is anonymous uh yearn is that's that's going back to my point well they all got like those projects um well there's some passive here whatever for example chido is mostly island not wrecked so far i mean we know the our guys know

this is recorded and we value privacy so this is the end of this part of the conversation well maybe just to add very quickly uh what we see is that mostly we talk about anon projects but there are some part of reputation uh attached also to pseudonyms and this reputation is notably built in the fact that some people know them um so this is it's a blurry state right you some people are unknown for a time and then they become well known in the community and then they reveal themselves sometimes um because they feel like it's a step in the right direction at some point or maybe they're doxed and they have to um so it's it's a very blurry um

term and nobody is really anon because you cannot trust a project if there's no at least a synonym that has some form of track record or something or or end up wrecked in the end um and just to get back to uh very quickly on the risk you because you said how to reduce the risk if you are doing an add-on project i feel like the most important thing to not have any risk is just to not direct your user because as you said everything is published on the blockchain and most likely that not people will find you if you do something bad and going back to the point of mark it's it's a good point that if your project

is fully decentralized um then there's no really uh point for being add-on um inside the project you can be on on i'm talking about the core team of the product that is leading the product division uh but then people outside working on github and as being add-on to participate or provide value to the protocol then it's fine but as a project and running the project from the the entire entire point of being island then usually in the system we say don't trust verify but the problem in projects that are built on top of smart contract you really the aspect of trust is very important because you will always value the

reputation of someone that is building a project way higher than uh the project mission because you you you understand that this person doesn't want his value his reputation is way higher than whatever he's trying to do in the market so you will always put faith in the person who's building the product and for me that's the most important aspect of the uh anonymity in this space is being add-on is fine but being add-on and running a project as a complete anonymousity aspect then it's always a great flag for me very interesting just to to bounce back on what you just said about the people who are known and who can becoming pseudonymous and revel themselves i mean the beauty with an enemy is you can be you can be a lawyer

during the day and a famous anonymous contributor to uh something i i will remain myself today now it's uh yeah it's i mean it's it's it's uh he said the name saifu is a good anon you know not right you know perfect let's uh maybe move to more more concrete how to work with someone who's how do you hire someone anonymous you are you are you have to check on its credential only on on in github i mean it's uh it's a basic question but uh it's um yeah we got um so in in state capital running all those different projects 90 people

employees we tried three times having a annual people that are none and working with us and we got raped three times so statistically speaking it's uh it's difficult um one we end up and this is also a story that might end up in in wreck but we end up there was a it's very famous in the indian industries like um you have firms um that are uh using uh the fragility of of young uh like kids and developers and they they lock them in the room and then their goal is to farm projects it's to uh in the early days of the project is to make friends with the project and and get access to gita get

access with this this is pretty big in china uh we have because it's uh it's proven we also have a police reports and all this stuff in canada so we got involved and then uh those persons they got access to and be placed in the multisig and also get access to some equity of the projects and then they start dumping the project and they start uh basically attacking the project and we've seen this in multiple sushi swap one of the uh unknown guide i worked for sushi swap then wrecked the website and then got uh but i mean i think this is broad and we need to openly speak about this uh my experience in the group hiring unknown people it's it's been painful uh not just economic uh uh damages but also

inside the team and um yeah it's it's pretty difficult i think uh the only way it's not hiring hanon it's just people participating participating in in code on github and get a ground for instance yeah but always double check and verify always the maximum security on the code that is being passed by someone that you don't know yeah because the reputation normally should be the one that is checking the making extra layer of verifications i completely agree with what has been said i will just cover the boring part i think if you have a legal entity it's going to be hard to have a fully fledged employee that is fully allen for obvious reason that being said

usually what happened is that you have service provider agreement so there's a lot of uh different juror addiction that will allow to pay in stable coin uh that doesn't mean uh i couldn't love that but i think simone is a bit more technical on this than me well there's no issue in in using stable coins for payment and it's not banned and in the eu as as long as mika is not in place uh you can do pretty much everything you want with with stable tablecoins um [Music] although you need to find an accountant that would accept that but yeah you basically cannot supposedly

you cannot work as a company with someone that you have not identified so that's the main blocker i mean that's the reason why i said you have to be legion to hire anons and the amount of risks that this implies uh makes it very unworkable in practice uh so usually uh i would not recommend working with unknown people uh except if this anonymity is not it's just a pseudonym of like a very well-known person and that this person agrees to reveal to you because that's the most important thing it can remain unknown for the rest of the people but you need to have

something at least to identify that it's always very simple things like you because if it's a purely unknown person you don't you're not even sure that it's only one person you're not even sure that uh the person uh does not sell his account to someone else you you don't know anything so you you it's really really easy to screw you it's it's perfect because it was it was my last question before of course i accept accepting some question from from you from all of you uh it's what what what will what will be your advice to someone either you want to create an anonymous project or better or someone who wants to to to stay unknown and working with a project so

julian you already told us that it's complicated to apply to the company and remain anonymous but uh i don't know what could be your advice um if you have if you want to share with us well um i think it's it's the first question is how did what do you define an project uh i mean uh if it's if you don't know the main let's say something which is not incorporated and you don't know the main uh executive amazing but then uh if you start from there you have a thousand of projects being deployed every single day because it's a smart contract by definition if the the the source of the the the the token that were founded to this wallet and create the smart contract then there's no one this is kind of another project by

definition i think the anon project it's a project that is trying to have a huge impact on on the ecosystem without taking the regulatory risk so this kind of project i would consider them as anon but the the person that deploying smart contract and small impact project uh those guys i think is because they don't want to necessarily like build a legal entity and then it goes to the past of uh paying expensive lawyers so it's my day but um on my side

we don't hire and on and as mark mentioned is because of legal reasons and uh and now when you have a broad like exec scope and your car system is it's very risky and this is not something that we want to take uh and for anyone that wants to um like not this like be unknown in the sense of being able to deploy smart contract without uh be uh asking questions to uh answering questions to people i think everyone is doing this uh on a daily basis i mean like uh many deploying an nft contract and and this is being added if you don't say that you're behind the project so there's two two stages of i don't know like those guys doing this and um and i really like what you said

all the i know people in the space if people if projects are working with them you can be 100 sure that they know each other like personally they talk on the phone they made before i don't know a single project in the space where we don't know the founders or the people that are being designed and it's strong that's why and then if uh ave is working with one project designer and i'm working with project design on you can consider that we did do the illusions ourselves we did double checking and it had this kind of extra layer of security on top it's not saying that if the project the product wouldn't get wrecked and we're not okay okay guys don't don't don't hate okay that's a very important point is that

we value pricey i think in this ecosystem that doesn't mean anonymity is a spectrum that doesn't mean you cannot give some information to a selected few people that you want to have synergy with obviously you take a risk when you do that because when you give your identity or or any kind of information to a selected party you take the risk that that selected party will leak that information and make it public and that's a huge risk for your privacy so that's something that need to be carefully considered that's why most annon in the industry are known to a very selected few members of the ecosystem

but i think we value the privacy enough to make sure that publicly those people have their pricing protect it so that's an important point it's a spectrum and if you want to take the unknown route i will say again you cannot have the the cake and needed to build something that is truly decentralized that will limit your risk because if you think being anon is a magic shield that will protect you from any risk i think that's stupid like literally because time is not on your side yeah and just just to react very quickly on that um and maybe to projecting in the future

we could really imagine ourselves like the crypto community developing tools that would help uh actually being anonymous for some people but providing proofs to other people without revealing too much that you have actually i don't know walked on a project or that you have been vouched by someone um i mean with zk proofs and this kind of things uh there's a lot of projects that are already thinking about decentralized identity and we could very well have this kind of identities that are pseudonymous and that have a very strong role in the future of the ecosystem because they are they are built with a lot of

identification a lot of proofs that you have actually done something and that you are a reputable person but i don't i'm not sure that we are at this stage today um if i can add something that is an example of my personal experience uh well for example i think if you're playing with people money it's difficult to bring the anonymousity aspect because the trust is here you don't want to get wrecked uh but for example without news i uh found reg news i ran reg news as a person beyond the the car founded and financially and on red news but then the rest of the content and the entire website and people that are involved it's amazing team is a kickass team but entire team is adam in the sense that the reason for that we're not playing with people money

but we provide the content that can be um for some person uh be taken as a personal attacks uh so in in this sense that we need to protect ourselves we need to protect the people that are writing those those piece of content because then we don't want them to be attacked and we want the content that we deploy the content that we ship to the industry for serving the people that are in this industry to be fully this content to be fully agnostic to be not associated with anyone so that's what we can provide the best service to our to the users to do you guys and trying to understand what's happening in space and if we ship a video that attacks some behaviors on the ecosystem you can

guarantee that we we serve you guys and uh that's important in this project is because it's not making uh it's not dealing with people money it's uh trying to build uh and understand what's happening in the space so that's the reason of being hand on it makes sense you don't want to get lawsuit for stuff that you write because people think this is either defamatory or like stuff like that but also erect never attack anyone we we try to understand and we make people make their own conclusions but we try to provide facts from the blockchain what we see on blockchains that's the reason why we can be anon because the information that we provide is information that we read from the blockchain from the on-chain data

thank you very much mark julian and simon for all this information i think we understand much more like what anonymity means in the crypto industry so you can upload them if you want i think next year we will oh i think i will do a track only on an anonymity because we have main stage we have main stage nicely i got confirmation if some of you have some question uh we will we can try to take maybe one i only wait the question was who's anand you said you raised your hand uh so i'm interested in it's a two-part

question so one which is from a legal perspective we think about what it means to be truly decentralized all the time but from a community perspective what's really important for you when you're looking at true decentralization then the other part of it which simon mentioned was we should build tools that help people build be anonymous but why wouldn't we build tools that will help people understand how to decentralize properly yeah i think this uh i only got the first part of your question uh so i will answer this one i think coming back to this point i think everyone should be anon in a sense not 100 anonymity of of entire uh as a person but part of the activity that you

do on the daily basis you have a certain spectrum of that um activity that should be add on to the rest of the world if you if you're buying something to the shop then this information should only you be uh your property in the sense that you shouldn't be and they'll be coming back to the privacy you're coming back like to all those different systems like the gaffa and all those even guys that are stealing uh and private information from people so i think like the animusity has a different level and as a human as someone part of the society we all need to have this part of anonymity part of us and this reason we have zero knowledge proof transactions and legally i think this is like causing a lot of issues but if we in europe gdpr

stopping from people stealing our information if if the governments and regulatory entities are built to serve people on the ground this is like as no way that we can go to a system that is not providing uh zero knowledge proof transaction like this is this is um this is a fact we have to go there and then this is the job of regulatory of regulators to make sure that those people that are doing this transaction you will have five ten percent or one percent of those people that are doing uh bad bad things but it's the job of the regulatory entities to to catch them and those kind of things how you can track those things

like nansen um all those different tools doing analytics uh chain analysis all those different tools can provide to the to the government's a system that we can track people that are using the system in a bad way but then the rest of us we should have this kind of anonymity uh attached to us i'm sorry we are we are running our cause time and i was thinking for the technical team that have to launch as any one of us thank you very much for this panel we arrive at the ending of the legal track i would like to thank you all of you all of the speakers the lcc for welcome this panel it's legal it's not a it's not something evident and of course the oral

team that have organized this panel luis alexander and and clara and everyone else thank you very much