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Crypto real-estate company CougarDAO gets a bank account: How you can too!
Doesn't sound like a big deal, but it is...
It started with a Twitter direct message, as these things so often do. The idea was not original. “What if we use Blockchain rails and crypto riches to buy an island?” Essentially the same idea every crypto degen and Bitcoin maxi has dreamt of for years.
You’ve seen the mockups, videos, designs, and other bullshit the crypto world has created to showcase their brilliant ideas for a utopian island nation, free from governments and taxes, that can best be described as wet-dream wrapped in a drug-induced hallucination… we loved the idea too!
Then the market corrected and the island-talk slowed considerably. As a team of lawyers, real estate professionals and investors, we’re saddled with the sad reality of the difficulties of accomplishing an island purchase using funds collected on a distributed basis in an unfriendly regulatory environment. Regardless, CougarDAO was born.
Rather than build the island nation utopia, we began discussing how to realistically and legally buy real estate, on-chain. What needs to be accomplished before we even start looking for investors? If we get investors, how do we convert those crypto investments to US dollars?
CougarDAO member James McCall learned Cougar Island, an island on Payette Lake in McCall, Idaho, might be going up for auction this summer. Whether it goes up for auction remains to be seen. If it does, we wanted to be in a position to attempt to purchase it at auction.
I know what you’re thinking, doesn’t one of the members of CougarDAO, have the last name McCall? Yes. It did not go unnoticed that McCall was trying to buy an island in a town named after him. It is a continuing point of contention.
Naturally, James accuses me, a single man of impeccable taste and dignity, of wanting Cougar Island as a recreational property for “cougars.” Nonsense, this island is for everyone! Probably the trash talk has kept this proof of concept project alive.
I digress. Let me tell you what we’ve done to move this project towards a reality.
First things first, we created a limited liability company (LLC), organized in the State of Wyoming and created with the assistance of our friends at KaliDAO. Kali is a DAO launcher for legally wrapped DAOs. We do not want to ride bareback into Cougarville without managing risk and limiting liability for purchasing real estate, without the proper legal entities in place. When in crypto, as in life, remember to bag the bugger in a legal wrapper from Kali.
Once we created the company: CougarDAO LLC, we knew we could start soliciting investments from others we knew in the space. There’s a number of people who’d put in $10,000 just to help with this proof of concept. However, that would not be helpful unless we could convert ETH, USDC, DAI, or CumRockets, to US dollars to actually purchase the property.
The next step was to create a bank account for our LLC. We did so on Mercury.com. We had to provide our LLC information and then both of the organizers of the LLC had to provide our know your customer (KYC) information. James McCall and I (Nick Rishwain) had to provide our birthdates, addresses, social security numbers and more. We dig into that a little bit more below:
First for CougarDAO we needed an email. We opted for the old tried and true Gmail.
Next we decided that we need to open a bank account and we had heard some good things about Mercury (and a few not so good things). But as a crypto-friendly neo-bank we decided to give it a shot.
OPEN THE BANK ACCOUNT:
The bank account application is actually fairly intrusive all things considered. It becomes quickly evident why we have issues with “banking the unbanked”, immigrants and anyone in a gray area, the homeless, cannabis, adult industry, etc. Add crypto to the scarlet letter that may get you unbanked as well.
Next steps to get a bank were
We needed to say that Cougar members aren’t involved in certain activities: adult business, money transmission, etc.
Need EIN - We filed with the IRS for this using their process. Need to choose tax treatment for the LLC. Some would likely want to talk to an accountant.
Need to State whether or not you are involved in Crypto. Sure this puts you into a higher risk bucket. Wonder where else this information goes?
Need to put address of business
Need Beneficial Interest of ownership
They ask for the Citizenship and SSN for the Beneficial Owners
Copy of Driver’s License
Selfie for intrusive Biometric Reasons.
Optional Social profile
Need to upload Articles of Organization (or formation docs)
Looks like the can auto-verify the EIN by uploaded the letter
They then ask for a flow of the business and purpose and how the revenue is going to happen. Surely this is used for risk management as well
It is clear that the AML/CYA/KYC has an impact on how complicated it is to open a bank account in the USA. There is no doubt that if politicians really want to “bank the unbanked” they will need to make the process easier and enable folks left behind in poverty, immigrants and the gray economy to open accounts.
Oh the places we will go. Please signup to follow the adventures of CougarDAO and the island.
With a little help from our friends, specifically @tmoindustries, we’ve discovered that Mercury.com is not exactly a bank. They’re more like a money transmitter or tech service connected to a bank. Now we’re looking into going to Wells Fargo, which we’ve learned may be more willing to assist crypto businesses, much like they’ve been willing to be helpful to cannabis businesses.
A wise man once said, banking is like having to pay to have someone rub their dick on your forehead. The saying remains true to this day.
Anyway, here is TMO’s experience setting up his Mercury.com “bank” account.