Blockchain Technology and Tokenization

Why Cooley

When blockchain and distributed ledger technology was in its infancy, Cooley’s lawyers advised the very first Bitcoin companies on the laws that might apply to the technology. Since then, Cooley has been counsel to some of the biggest names in the blockchain technology and tokenization space. Regulators, too, on both the federal and state levels, and Congressional staff, call directly upon Cooley’s lawyers to share our legal analysis and industry intelligence.

The Team

The team is composed of thought leaders in the law of securities, privacy, broker-dealer, intellectual property, cybersecurity and tax, among others. Our multidisciplinary approach is founded on a straightforward strategy: prepare our clients to leverage the benefits of blockchain solutions while identifying and mitigating the risks of an evolving regulatory landscape. Cooley has been called upon by SEC-regulated companies to help integrate blockchain technology, by banks to review new bitcoin client accounts, by digital currency exchangers for regulatory compliance, and even by legislators to write new blockchain-specific laws from scratch. 

Capabilities

Securities Laws

Our team offers comprehensive securities product counsel, from whiteboarding a new product to launching it. Cooley can help answer questions like: Is my product a security? Will my new service be considered a broker-dealer? The Cooley team acts as your “lawyer in the room” at early brainstorming and product creation sessions. We work with your team to craft an offering that both pushes the envelope and keeps regulators happy. 

Privacy & Data Security

Cooley lawyers advised on the privacy and data security considerations for the healthcare industry’s largest Blockchain consortium. Embedding confidential information, like customer data and trade secrets, on a blockchain can create unprecedented efficiencies. It also means a new set of risks. Cooley’s team works with clients across multiple jurisdictions, advising on compliance reviews, developing customized policies and procedures, offering guidance on international data flow, handling domestic notifications/registrations and aiding in data security breach preparedness and response. The team’s scope is tailored to the geographic needs of the client, with services that can be scaled from business in a single state or country to the pan-EU, and the wider, global patchwork of international privacy laws.

Public Policy

Our team has been leading the conversation on blockchain regulation and tokenization in Washington, DC and on the state level since its beginning. Our lawyers are active participants in several of the leading trade and advocacy groups, including the Chamber of Digital Commerce and the Wall Street Blockchain Alliance.

Patent Counseling and Prosecution

Cooley’s market-leading patent practice provides the full spectrum of counseling and prosecution representation in the areas of blockchain applications and tokenization. We assist our clients in navigating the complex and evolving legal and regulatory landscape in this sector. Our lawyers have significant experience securing patent protection for complex blockchain/FinTech technologies and providing strategic IP counseling to a broad range of companies across a variety of industry segments including peer-to-peer and alternative lending, mobile and online payments, and investment tools.  

Intellectual Property

Cooley’s IP lawyers have years of experience protecting digital currency and blockchain technology-related inventions and brands. The team brings extensive experience obtaining IP protection and counseling clients on third-party patent rights covering technologies such as distributed-ledger technologies, consensus algorithms, and zero-knowledge proof applications. In addition, we are deeply experienced in counseling clients on the selection and adoption of trademarks, the protection of trademarks and copyrights, the use of intellectual property and the risks of claims arising in advertising.

Dispute Resolution and Litigation

Courts around the country and around the world are struggling with how to apply old laws to new distributed technology. Cooley lawyers understand that technology, how our clients use it and how disputes over it arise. The team has the experience necessary to ensure judges and juries do, too. Cooley lawyers also assist clients with inquiries and investigations by the SEC.

Taxation Cooley lawyers advised on the applicability of the tax laws on some of the very first ICO (token sales). The IRS has taken the position that certain digital currencies, for the purposes of tax law, are treated as property, not currency. Thus, digital currency users must pay income tax on profit generated from digital transactions, and, in certain circumstances, long-term capital gains income tax on digital currency held over a year prior to sale. States have also released guidance on the taxation of digital currency, which have generally treated digital currencies as intangible goods. Cooley advises on the tax treatment of digital currency investment, mining and income structures.