Establishment of a Chinese Pioneer Company

Summary
The BarnBridge DAO has been supporting a designated community manager for the China user base since April 2021. Given recent local developments and conversations with other projects maintaining similar efforts, further commitment to such an initiative will require the formation of a “pioneer company.” This proposal lays out the projected budget for the effort and addresses the renewal of Leo’s role.

Description
The purpose of a pioneer company is to have a registered entity for Leo’s community management efforts in China. This will allow Leo to continue his conversations with local funds, remaining retail portals, and other crypto projects in a compliant manner. The pioneer company would have no formal connection with the BarnBridge DAO, meaning that there would be no economic ties connecting the two. The funds set aside for the initiative would effectively be a grant of working capital for its formation and maintenance.

The requested amount of $6,000 would cover the following:

  • Business Registration: The costs associated with getting approval from relevant bureaucratic authorities

  • Company Address Hosting: Leo’s work would remain remote and not require an office, but the equivalent of a P.O. box / official place of business will be expected

  • Financial Accounting: A third-party entity would be required to sign-off on the financials of the company

These expenses would be in addition to a proposed quarterly salary of 225 BOND paid to Leo. He currently is a one-man team, but expects there to be the need for a local social media employee by Q4 of 2021.

Motivation
Despite recent crackdowns on fossil fuel Bitcoin mining and high leverage derivatives, the Chinese government still views blockchain applications as being an important strategic pillar for its economic policy. This means that the prospective market for blockchain applications that are able to provide functionality beyond just their own token is quite significant. Formalization of BarnBridge’s presence and Leo’s efforts in China opens up doors to the relevant policy makers, fund managers, fintechs, and crypto projects that will give it a shot at that type of adoption.

Technical details
$6,000 USDT would be allocated from the DAO’s reserves to Leo’s provided address. His salary would continue to be paid from the 10,000 BOND allocated in PID-2 to the community wallet. Receipts from the aforementioned expenses would be reported to the BarnBridge core team.

Work to Date
Leo’s community management efforts over the past two months have focused primarily on creating official BarnBridge presences across the Chinese crypto media ecosystem and establishing relationships with other projects and funds in the space. The following are some highlights:

  • Created and manages official BarnBridge profiles across major Chinese media outlets
  • Represented BarnBridge at conferences in Shanghai and Hangzhou
  • Struck a formalized partnership with a blockchain incubator fund
  • Authored native content as well as translations

Sustainability
The work housed within the Pioneer Company would simply be the work that Leo is already being compensated to do. Regarding any recurring costs associated with the continued maintenance of the company, Leo believes that it could grow self-sufficient off a business model centered on strategy consulting for BarnBridge products.

SnapShot Vote
There is no SnapShot vote at this time. Please share your comments, questions, or concerns here in the thread, and keep an eye out on the Discord server as Leo would be available for an AMA in the #Embassy channel.

4 Likes

Since this is a one time cost associated with adding some legitimacy to Leo’s work, it seems reasonable to me, given that all costs would be receipted and accounted for.

1 Like

Great idea! I am for. Let’s do this!

1 Like

I think this is a great idea, especially considering the work that Leo has put in.

1 Like

We need the exposure. Leo seems to be doing a great job for us. If this is what it takes for him to operate within regulations you have my support.

1 Like

I think this makes a lot of sense and is a fairly trivial amount to be compliant in an important market for us. Keep up the good work Leo!

1 Like

Leo already have salary paid in BOND is this 225 BOND going to be paid on top of it or his salary will be raised to 225 BOND?

TBH there is so many restriction for cryptocurency in China. According to last info anything directly or indirectly related with crypto is going to close in China. I would like to hear @effJ 's point of wiev on this topic before we will invest more money in to China. :+1:

2 Likes

Hey, thank you for your question.
Please allow me to answer question 1, about Leo’s compensation. Since the original compensation payment scheme claims weekly through the ownership contract, the quantity is determined according to the future price trend of BOND.
The actual implementation plan is directly distributed through BOND transferred by PID-2 proposal. Therefore, it needs to be adjusted according to the real-time price of BOND. Next, the amount of US dollars initially determined will be used as the standard for each issue.
Your second question is about the legality of encryption industry in China.
In the field of encryption industry/blockchain, the focus of the government’s crackdown has always been energy-consuming mining activities such as BTC, followed by restricting people’s digital currency speculation and raising the threshold for participating in currency speculation.
However, the government strongly supports the development of blockchain technology, especially the blockchain innovation projects that can empower the real economy. We have absolute reason to believe that BB’s innovation value in the financial field far exceeds its token value, and CONFLUX’s innovation has won investment from the government background. We need a local legal background to carry out a series of activities legally in China, and even the potential communication with the government needs the existence of such a legal entity as support.
What we pay attention to is definitely not the value hype of tokens, but more attention to the innovation brought by the project itself in the financial field, which is in full line with the direction that the Chinese government respects in the blockchain field

2 Likes

This may seem like a good idea on the surface but I don’t think that the concerns of Chinese government’s control over crypto and Bitcoin can be brushed aside so easily.
Opacity in the communication that appears on Chinese websites or general Chinese media is also a concern.

Leo already has a role that allows him to act as a community manager for Chinese users. I don’t think there is any precedence of a “pioneer company” needed for such efforts. Leo is compensated as a team member of BarnBridge. What other compliance is needed for conversations with potential customers in China other than being a team member?

I also don’t find it logical that BarnBridge DAO should bear the business setup costs of another business entity? Again, this has no precedent in normal business practice or in crypto.

You either form a Joint Venture with an independent organization, which in this case should be something Leo registers as a Chinese citizens in his name. In that case, I don’t see the need to finance the company registration itself. This is something which is mutually beneficial and should be mutually invested. If its not a JV partner, then things should simply be represented as BarnBridge DAO, of which Leo is already part of.

I don’t get how this would be a prudent thing to do.

2 Likes

Arthur_0x discussed the boots on the ground importance to the Chinese markets on the latest Bankless. I disagree with the above point about ‘no precedent’. It is not uncommon to require a legal entity to do certain forms of business in certain jurisdictions, including China and elsewhere. I think it may be prudent to follow an SNX type of model for this particular issue, whereby the DAO votes for a council who coordinates all things JV related, inlcuding appointment of an officer, etc. Investing into this market in this way makes sense. There are trailing issues here in terms of how DAO revenue may be attributed to the legal entity, but without the legal entity Leo could be held personally liable. And for such risk, I doubt he would want to continue. Collectively, the benefits of correct legalities in China seem to outweigh the costs – a presumption that perhaps should be supported by some sort of market analysis that has been done…

2 Likes

It may also be prudent to explain – or perhaps expand on certain items from the community call – what risks the “ban” has in terms of $BOND’s structured offerings, and if there are perhaps certain offerings that should and shouldnt be applicable in China (e.g., those with more risk, those with LM incentives attached, etc.).

Yes, you are very comprehensive and have a certain understanding of China’s environment.
In fact, we have considered some of the things you mentioned. At present, we only need such a legal entity in China, so as to ensure that BB’s activities in China are not the personal behavior of Leo or someone, but a business behavior with corporate legal background.This will inevitably bring great convenience
At the same time, however, pioneer companies have to avoid some risks. For example, as you mentioned, Leo will bear some risks (thank you for your consideration), which requires us to position the pioneer company. BB’s Chinese pioneer company only focuses on blockchain technology and innovative products in the financial field. It only focuses on how to make BB’s innovative financial derivatives empower traditional finance, but can’t involve any other things about token hype or price commitment.
I believe that as long as we follow this starting point, the legitimacy of Pioneer Company in China can be fully guaranteed. This is also the guideline that BB core team always abides by.