Startup Funding Espresso – Treasury Function in Web3

Treasury Function in Web3

Hello, this is Hall T. Martin with the Startup Funding Espresso — your daily shot of startup funding and investing.

Web3 brings a new function the startup must manage: the treasury.

The treasury function exists in the Web2 world but typically has no impact until later in the life of the startup.

For the Web3 company, the treasury has an important role from day one.

The Web3 world introduces the concept of the token which provides value to the members of the startup.

Those holding tokens have the option of converting those tokens into dollars.

The treasury must be able to handle the conversion to fiat currency.

There are also tax implications with tokens.

Using tokens as incentives for sales and other activities triggers taxable events.

Tokens can fluctuate in price dramatically.

As tokens rise, it increases in value to the holder.

As tokens fall, it decreases.

Taxable events must be paid regardless of the current value of the token.

Tokens bring a new level of complexity to the startup which must be managed early on.

Consider how to handle the treasury function for your startup.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding. Let’s go startup something today.

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