A company is not legally required to maximize profits to shareholders. That is straightforwardly incorrect. It's also something that only shareholders themselves can bring suit over, so if shareholders are aligned (as they are in 99% of crypto companies that have a US labs co) it's wrong on the ec
The article argues that the claim that companies are not legally required to maximize profits is incorrect, especially regarding crypto companies with US labs and a16z backing.
A company is not legally required to maximize profits to shareholders. That is straightforwardly incorrect. It's also something that only shareholders themselves can bring suit over, so if shareholders are aligned (as they are in 99% of crypto companies that have a US labs co) it's wrong on the ec
Actually, the officers and directors of a Delaware c-corp do in fact have fiduciary duties to maximize long term value for shareholders. It’s very easy to satisfy those obligations when launching a protocol/token, particularly where shareholders and the company have exposure to the token. That’s st
Yes, long-term value for shareholders is not "maximize profit." There is no obligation to maximize profit to shareholders which is what you claimed in the OP. I am sure you guys continue to hold shares in Delaware C corps whose tokens you have since sold. Devcos don't generally have exits, so those
It is in the interest of a company to protect its overall economic interests. This includes debt, physical assets, financial assets, commitments, public reputation, etc. There are all sorts of reasons for companies to spend money on things besides producing profits for shareholders, even including c
“Maximizing value” and “maximizing profits” is a distinction without a difference. And no, I’m not aware of a company with a similar fact pattern in our portfolio. Very few companies take company profits and distribute them to tokenholders—doing so makes the token a profits interest in the company
I'll take your non-answer as the obvious answer, which is yes. Of course you do. So do we. Everyone who is a private investor in crypto does, and if they don't now, they will eventually once they sell the tokens they're holding. In which case this claim "the company is legally required to maximize