I read that users can issue shares on the platform. Are these shares registered with the government in some way?

Currently, the shares are NOT registered by any Government as we are focusing on LLCs and equivalents, which generally are not registered. The record-keeping is the board’s responsibility, and many companies have their lawyers or accountants keeping a copy of the shareholder list using excel.

Most of the jurisdictions we have looked into (the US and Europe) do not have a centralized registry, which explains the popularity of various Cap-table and Share management software. For example, in the US, there is a threshold; if your shareholders reach a specific number, you need to register.

Trading unregistered shares is a hassle, and ownership is opaque.

We see ourselves stepping into this “Void,” leveraging Stellar to maintain a better share-ledger structure and build on top of it. We are in discussions here in N-Europe on how to feed changes as they happen to the Government registries.

They are legally enforceable in the same way as current systems allow.

The shared ledger is the board’s responsibility. You are legally an owner once your name is entered into the registry. The shareholders also decide on how the shares can be traded and if there are restrictions on trade.

Our approach is based on this. Usually, share management is not programmable, but you have agreements, articles, and excel sheets; it could be better. So we can give shareholders and board members better tools with more control and enforce transfer approval, but everything is more transparent.

Let’s say you are joining a company.

Most commonly, you must be approved by the board and authorized to hold the asset. Then, before a sale happens, other shareholders need to be notified and might have the right to refuse or step into the deal, depending on the rules the shareholders have set.

Suppose anything on the platform is done unlawfully. In that case, it’s simple to take the ledger and its immutable records to court to explain what happened. Using these records and testimony will give judges better proof and data. This claim of benefit has been validated in conversations with lawyers. Clawback can also be used to retrieve stolen assets.

It’s much safer this way compared to the traditional setup.

Try our product, the Calyx, at www.mojoflower.io

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Mojoflower

Mojoflower is an Icelandic-based software development company. Our platform will enable businesses to access and connect to various web3 services.