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Simple Agreement for Future Tokens
I need a Simple Agreement for Future Tokens (SAFT) for an early-stage startup seeking to raise funds through token sales, with clear terms on token allocation, vesting schedule, and compliance with Indonesian regulations. The agreement should include provisions for investor rights, token issuance timeline, and potential risks associated with the investment.
What is a Simple Agreement for Future Tokens?
A Simple Agreement for Future Tokens (SAFT) functions as a legal contract between blockchain startups and investors in Indonesia's digital asset space. It lets companies raise funds by promising investors a specific number of tokens once their blockchain platform launches, while staying compliant with OJK regulations and Indonesian securities laws.
Think of it as a pre-order agreement for future crypto tokens. The investor provides capital now, and the company commits to delivering tokens later when the network goes live. This structure helps Indonesian tech startups secure early-stage funding while giving investors a clear path to token ownership, all within the framework of Indonesia's evolving digital asset regulations.
When should you use a Simple Agreement for Future Tokens?
Use a Simple Agreement for Future Tokens when your Indonesian blockchain startup needs early funding but your tokens aren't ready for distribution. This agreement works perfectly during product development phases, letting you secure investment while building your platform. It provides legal clarity under OJK guidelines and helps avoid potential securities compliance issues.
The timing matters most when you have a clear token development roadmap but need capital immediately. For example, many Indonesian fintech startups use SAFTs during their initial fundraising rounds, typically 6-12 months before their planned token launch. This approach keeps both investors and regulators comfortable while maintaining flexibility in your token economics.
What are the different types of Simple Agreement for Future Tokens?
- Basic SAFT: Designed for straightforward token sales with Indonesian investors, featuring standard vesting periods and token distribution terms
- Milestone-Based SAFT: Links token distribution to specific project achievements, protecting both investor interests and startup flexibility
- Discount SAFT: Offers early investors preferential token pricing compared to future public sales, common in Indonesian DeFi projects
- Hybrid SAFT: Combines token rights with traditional equity elements, adapted to comply with OJK regulations
- Project-Specific SAFT: Customized for particular blockchain use cases, with industry-specific compliance provisions and token utility definitions
Who should typically use a Simple Agreement for Future Tokens?
- Blockchain Startups: The primary issuers of SAFTs, using them to raise capital during early development stages while ensuring regulatory compliance
- Angel Investors: High-net-worth individuals who provide early funding in exchange for future token rights under Indonesian investment laws
- Legal Counsel: Specialists in digital asset law who draft and review SAFTs to ensure OJK compliance and investor protection
- Token Development Teams: Technical teams responsible for meeting SAFT milestones and token delivery obligations
- Compliance Officers: Internal staff who monitor SAFT execution against Indonesian securities regulations and anti-money laundering requirements
How do you write a Simple Agreement for Future Tokens?
- Token Details: Document your token's utility, distribution mechanism, and vesting schedule in line with OJK guidelines
- Investment Terms: Define investment amount, token price calculations, and delivery timeline post-network launch
- Company Information: Gather corporate documents, blockchain development roadmap, and team credentials
- Investor Verification: Collect KYC documentation and accredited investor status proof per Indonesian regulations
- Risk Disclosures: List potential project risks, market uncertainties, and regulatory compliance requirements
- Technical Specifications: Detail token functionality, smart contract architecture, and security measures
What should be included in a Simple Agreement for Future Tokens?
- Party Details: Complete legal names, addresses, and registration numbers of token issuer and investor
- Token Specifications: Detailed description of future tokens, including utility features and technical parameters
- Investment Terms: Purchase amount, token price calculation method, and delivery conditions
- Vesting Schedule: Clear timeline for token distribution, including any lock-up periods
- Risk Disclosures: Comprehensive statement of investment risks under OJK requirements
- Regulatory Compliance: References to relevant Indonesian crypto and securities regulations
- Dispute Resolution: Choice of Indonesian law and jurisdiction for conflict resolution
What's the difference between a Simple Agreement for Future Tokens and a Simple Agreement for Future Equity?
A Simple Agreement for Future Tokens (SAFT) differs significantly from a Simple Agreement for Future Equity (SAFE) in several key aspects, though both are investment instruments used in Indonesian startups. While they share a similar structure for future rights, their underlying assets and regulatory frameworks are quite different.
- Asset Type: SAFTs promise future cryptocurrency tokens, while SAFEs convert to company equity shares
- Regulatory Framework: SAFTs fall under OJK's digital asset regulations, while SAFEs follow traditional Indonesian corporate law
- Investment Timeline: SAFTs typically convert upon token launch or platform completion, SAFEs convert at the next equity funding round
- Risk Profile: SAFTs carry additional technological and regulatory risks specific to blockchain projects, while SAFEs face standard startup risks
- Exit Mechanism: SAFTs provide tokens with immediate market liquidity, whereas SAFEs require traditional exit events like IPOs or acquisitions
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