Articles Posted in Blockchain

AdobeStock_392233450-300x200Cryptocurrency has become a critical issue for many California business owners. These new forms of currency can be convenient, but they can also create legal obligations for the businesses that use them. It is important for all business owners to understand the legal implications of cryptocurrency offerings before engaging in any transactions. Some cryptocurrency transactions can fall under the SEC requirements, and business owners can face liability for failing to register their offerings or meeting other legal requirements.

Security Versus Utility

Cryptocurrency can be either a security or a utility, depending on how it is being used. A security is a fungible and negotiable financial instrument with some type of monetary value. When discussing securities, many investors immediately consider stock certificates. This is a classic example of a traditional security. They are not, however, the only item that can be used as a security. Cryptocurrency can also be used as a fungible, negotiable financial instrument, and often these instruments hold significant monetary value.

AdobeStock_194813254-300x200In forward-thinking Silicon Valley, many individuals and businesses have made profitable investments in Bitcoin and other cryptocurrencies. Employers may want to take advantage of healthy appreciation and pay their employees in this increasingly-valuable currency. But employers must use caution. Employment laws still apply to regulate the manner in which a worker must be paid. Wage and hour disputes are more difficult with cryptocurrency, and there is not yet clear case law to define these issues. Employers should consult with an experienced Silicon Valley employment law attorney before making the decision to switch to crypto.

Call (408) 441-7500 to schedule a consultation with one of our skilled San Jose business lawyers. We help California employers find ways to implement new technologies while meeting their legal obligations.

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