Early in the year when we were figuring out the best structure to handle both domestic US investors and foreign investors along with the investment being made in crypto-currency, it was planned to keep the two entities (Coin Services LLC and Big Trend Capital Investment Limited) completely separate. This would allow the foreign investment received to fall under Reg. S for an exemption from formal registration and simply withholding under IRS tax laws. (This was the wording you saw in the post).

As such I asked John to provide nominee services while I retained complete control of BTCI Ltd. via a power of attorney and control of the company
seals. Since then, the SEC and the IRS have become more clear on how to define usage of cyptro-currencies and as such and while it was decided to use the same structure we kept the same execution plan and we wanted to keep very clear distinction of the two offerings. We do not need to make it clearly two distinct entities, hence this posting explain and linking the two together for more transparency.

BTCI does hold 40% of the Member Units of Coin Services LLC. This amount of units is the basis of the investment on Havelock for foreign investors. US investors will invest directly with the US LLC via a Reg. D 506c exemption we have obtained from the SEC. To avail ourselves of both exemptions we do need to keep the two offerings separate from each other and will do such through the onshore and offshore entities.

While it seems confusing and complex, our goal is to maintain compliance with the many SEC laws governing private placement and foreign investment. Many other startups who have raised funds in crypto did not take the time, money or effort to keep in compliance and these are the stories we all have recently heard that shake the foundation of crypto investing.

Dividends, based on the Reg. S exemption can be paid from Coin Services to BTCI to pass on to Havelock for distribution to investors and we have tried to structure the dividend payout to have the least amount of withholding taxes as possible to put more return in the hands of the investors.