you just sound jealous and salty
Thought the video was really good and really well done. The lil animation bit was a nice touch.
I’m choosing to just discard the last minute and take the rest of it for what it is.
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Ok, I just went through the entire terms of use of Liquidmarketplace, and I’'ll be going over the most concerning parts here. This will also answer some questions, e.g. how selling works, what the voting mechanic is really about and what the 80% thing that enigma mentioned is about. But before covering the terms of use, here’s a general overview of how the system works:
- An item gets selected an authenticated by experts. It will then be transferred to a vault
- Liquid Marketplace then creates “ERC-20 Tokens on the Ethereum blockchain, stored in a digital wallet maintained by a third-party service provider, and recorded on the Platform”. Each token is initially worth $0.10. So in the case of the Illustrator which is initially priced at US$5,000,000, 50,000,000 tokens will be created.
- The item will be listed on Liquid Marketplace under “offerings” and people can begin to buy the created tokens for $0.10 each.
- After all tokens have sold out, the item is moved to the ‘MarketPlace’ where users can buy, sell, and trade tokens.
Right away, you should come to terms with the fact that what you are buying is a digital cryptocurrency representing the value of a real item, not a real part of the item. If you do not have faith in the safety of cryptocurrencies or NFTs and do not feel comfortable holding a part of your money in digital form for an extended period of time (e.g. you fear that the tokens could get stolen from the wallet), you have no reason to use Liquidmarketplace.
Now that the basic concept is clear, let’s go over the terms of use.
2.1 These Terms apply to the Platform, including any updates or supplements. We may change or revise any aspect of these Terms or the Platform from time to time in our sole discretion, by posting the revised Terms on the Platform or electronically sending you the revised Terms. […] Your use of the Platform after such revised Terms are made available will signify your acceptance of such revised Terms and your agreement to be bound by them. If you do not agree with any such modification, your sole and exclusive remedy is to terminate your use of the Platform and close your Account.
If you are short on time, you might as well stop reading right here. This part alone would deter me from using this marketplace. They could simply change the terms of use to say that the created tokens do not represent ownership of the item anymore and there’s nothing you can do about it. They have also included legal protections against lawsuits later on. But for the sake of the argument, let’s continue.
4.3 User Authorizations
You hereby authorize Liquid Marketplace, its third party service providers, and their respective employees and agents, in relation to your Account and use of the Platform, to, among other things:
[…]
(b) transfer of Funds to/from your Account;
[…]
(d) freeze further credit or debit to or from your Account due to your breach of these Terms or breach of applicable law, or if there is a suspicion of money laundering/terrorism financing, or if there are breaches of anti-money laundering/countering the financing of terrorism policies and procedures
This part didn’t surprise me and it’s not that extraordinary, but you should still be aware that Liquidmarketplace can freeze your account for a breach of terms of use (which they can change on a whim).
5.2 Purchasing Tokens
[…]We reserve the right to change the prices of each Token at any time or from time to time at our sole and absolute discretion, and to limit the number of Tokens each user is entitled to Purchase.
So not only can they decide how many Tokens I may buy, they also can change the value of each token by themselves (instead of letting the transactions on the marketplace regulate the price)? That makes the token worthless in my opinion, and it opens possibilities for all kinds of shenanigans.
7.2 Ownership of Collectible
In order to list a Collectible for sale on the Platform, the Collector (i.e. the owner of the Collectible) […] will convey all right, title and interest in and to the Collectible to the holders of the Tokens (“Tokenholders”) representing such Collectible.
7.3 Pursuant to the Custody Agreement, neither the Collector nor an individual Tokenholder will have the right to take possession of the Collectible or direct the Custodian in any manner whatsoever, unless an individual acquires sole ownership of the Tokens associated with a Collectible, whether through a Buyout (as defined below) or otherwise. […] Once an individual owns 100% of the Tokens associated with a Collectible on the Platform, that user may be given the option to take possession of the Collectible using the Platform. […]
These points reiterate that by listing the collectible on liquidmarketplace, the collector relinquishes the rights to the collectible to tokenholders, and that full ownership of the collectible can only be claimed again if anyone has all 100% of the tokens in their possession. The really egregious part is the buyouts that they mentioned. Here’s why:
7.4 Buyouts
We may allow users to Purchase all of the Tokens associated with a certain Collectible without the other Tokenholders associated with that Collectible executing a Sale (a “Buyout”). A Buyout can only be exercised by a user who first acquires the minimum number of Tokens associated with a Collectible that Liquid Marketplace may establish from time to time (the “Buyout Threshold”). […]
Once your ownership of Tokens associated with a Collectible meets or exceeds the Buyout Threshold, you may request a Buyout through the Platform (“Buyout Offer”). In order for the Buyout to be accepted, 80% of the Tokens associated with that Collectible (including the Tokens owned by you) must be voted in favour of the Buyout Offer within a 72-hour period. In the event that 80% or more of the Tokens associated with the Collectible vote in favour of the Buyout Offer, the remaining Tokens will automatically be tendered as part of the Buyout.
In essence, this means that if you own a certain amount of tokens from one item to exceed the token threshold (that liquidmarketplace defines and can change), you can request a buyout of any remaining token of the item that is not in your possession, and if 80% of the tokens get approved for sale, you get all 100%. Vice versa, this means that even if you did not list your tokens for sale, you are still at risk of losing them without your consent unless you own more than 20% of all tokens.
9.1 User Warranties
You agree that you are responsible for your own conduct while accessing or using the Platform, and for any consequences thereof. You agree to use the Platform only for purposes that are legal, proper and in accordance with these Terms and any applicable laws or regulations.
9.2 Effect of Your Breaches
If you engage in any of the Prohibited Activities we may, at our sole and absolute discretion, without notice or liability to you, and without limiting any of our other rights or remedies at law or in equity, immediately suspend or terminate your Account and/or delete your Tokens from the Platform. If we delete your Tokens from the Platform, you will not receive a refund of any amounts you paid for those Tokens.
As someone who has been trading crypto before, this is a major red flag. If they are able to delete tokens, it means they can manipulate the market at will (imagine if the creator of Bitcoin could simply delete Bitcoins from other people’s wallets, the entire currency would immediately collapse due to the breach of trust). It also begs the question if they could create additional tokens afterwards for an inflationary effect.
- Dispute Resolution; Binding Arbitration
To the full extent permitted by applicable law, you are agreeing to give up any rights to litigate claims in a court. Other rights that you would have if you went to court may also be unavailable or may be limited in arbitration. You hereby expressly give up your right to have a trial by jury, where applicable. To the fullest extent permitted by applicable law, you hereby expressly give up your right to participate as a member of a class of claimants in any lawsuit, but not limited to, class action lawsuits involving any such dispute.
I don’t know if this would stand in court, but they want to make really sure that you have no rights if push comes to shove.
To sum it up: If you participate in liquidmarketplace, you do not buy a physical contract that confirms partial ownership of an item and that you can safely store in your vault. You participate in an ecosystem that dictates all rules at leisure and gives you zero rights. And if that ecosystem thinks that you violated any terms of use, you will lose your tokens and thereby your partial ownership.
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After reading the T&Cs, it confirms my theory that Logan will sell 51% of the $5M value, tank the value, buy coins until he hits 81%, then buy the rest to regain ownership of the card while making a few million doing so. It reads scam all over it
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My simple brain just thought this was a direct share ownership. This digital ownership world is too unregulated for my boomer blood.
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The % distribution of the token supply turns me off the most I would say, even having a good understanding of crypto, ETH and token based distribution of an asset. Having one person/entity with a 49% stake is just too much in my view.
I mean a lot of stocks for example have 60, 70 or 80% institutional ownership compared to retail investors… but there’s literally 100s if not 1000s of institutions involved in that pool of majority ownership. But having just 1 guy or a single entity with 49% means they could easily crash the asset if they decide to cash out or do a variety of other manipulation. It just wouldn’t be for me, as much as I’d love to own a piece of this card in some form.
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Don’t worry, guys. Ken Goldin was announced as a partner in Liquid Marketplace. Now we can all rest assured that there will definitely not be any slimy business practices anywhere near this platform.
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this is such a disappointment. the hobby doesn’t need unregulated digital partial ownership vehicles 
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Look Patreon of Team Maverick, I don’t particularly like scammers to be honest.
This guys got a point…
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Alright so he’s a co-founder of this company liquid marketplace.
The TOS require 80% of tokens to approve a buyout, but he owns 49% of the tokens 
So you are literally buying nothing when you buy shares/tokens. This is even further removed from ownership of something than owning an NFT. How much more abstract can we get here?
I try to ignore LP threads, but I gotta call them like I see them, this is scummy.
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@ripguyfawkes thank you for going through the ToS and posting here. That 80% Buyout number definitely makes more sense than what I was saying lol. Though Liquid Marketplace could change that 80% to 51% overnight if they wanted…
I don’t think risking $0.10 is bad, but in this case I’m unsure what upside you’d be risking it for…and I doubt 50 million people are going to each buy 1 share of this. I wouldn’t be surprised if some of LP’s friends bought thousands and thousands as insurance so collectively they would own a majority and could later vote for a buyout alongside him, if the platform lowers the “Buyout Threshold”.
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We all got duped, agreed?
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The 80% math doesn’t even matter, since the Platform can change its rules whenever and however it wants with pretty much zero warning and recourse. As a token holder, you are at the absolute mercy of the Platform. LP is all about the hustle. Haven’t we seen his true color for some time now?
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Does the website say how many have joined this scheme so far? I can’t imagine even 10% of the total shares being sold even for 10 cents
I mean, did we expect anything less from Logan? Homie is driven by money. Just do yourself a favor, for those that haven’t watched the video yet, press play and stop until the last minute. You’ll be aight.
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@0ean Here’s the thing: This platform will attract primarily investors and speculators that want to make big money (and there are more than enough of them in the world). It won’t attract collectors of physical cards because they’d rather go after cards they can own at home or at least in an accessible vault, because they value the experience of holding the card in their hands and looking at the real thing.
In that sense, liquidmarketplace is the antithesis to our understanding of Pokemon collecting. They are not just offering digital goods that were created in digital form from scratch. They are also buying physical collectibles that were meant to be interacted with in the real word, and they are putting them in a vault so that they literally never see the light of day again (a realistic scenario if the platform worked as intended and the spread of tokens were so distributed that an 80% majority ownership would not be feasible anymore). I feel bad that the PSA10 Illustrator of all cards is in danger of experiencing this fate.
@eeveeteam Sure, there will be plenty of opportunities for liquidmarketplace to make their money back via pump n dump scheme of the tokens. The mistake would be to think that they have to wait that long to make their money back. We have no way to verify how and why the starting price of an item has been chosen. In the case of the Illustrator we know a bit more because of Logan’s videos (but even here we just have to believe his story), but for any other items it will be completely untransparent. If they bought a Pokemon card from a private seller for $2 mil and then offer it on liquidmarketplace for $4 mil, they have doubled their money by the time all tokens have initially been sold for $0.10 cent each, even before the item goes to the real marketplace. Such an untransparent way of determining prices could also completely shatter trust in the conventional Pokemon market, unless the value of Pokemon cards on liquidmarketplace is considered invalid data points by the collecting community, but then what’s the point of using the platform?
Tbh, the more I think about liquidmarketplace, the worse it gets. There are so many scenarios that could screw users over. Here are some examples:
-
Liquidmarketplace announces that the needed majority ownership for a guaranteed successful buyout is lowered from 80% to 60% for the coming weekend. You didn’t want to ever sell your share of the card so you bought 21% of all tokens, but now you must panic-buy another 20% just to survive the coming weekend.
-
Liquidmarketplace changes the rules as in 1., but they don’t inform you. They just change the Terms of Use overnight. You wake up and see all your tokens gone.
-
Remember that the tokens are erc-20 based? This means you can transfer them out of their platform to any wallet you desire. Let’s say you want to transfer your tokens to your personal metamask wallet but then your pc breaks and you forgot your seed phrase. Boom, your wallet is gone and so are your tokens.
-
Even worse, let’s say someone nefarious buys a big part of tokens of one item, and then sends all those tokens to a burner wallet (one that can receive tokens, but never send them back). What now? Is the item suddenly incomplete? Or is it still 100% complete but x% are inaccessible for all eternity, basically making a buyout impossible and locking the card in the vault forever? Or are the remaining accessible tokens considered the new 100%? But then the price of the item (the price per token) would suddenly be inflated for a completely illegitimate reason (not because of demand but because of market manipulation). Liquidmarketplace could then create new tokens to counteract the burning, but by doing so they completely delegitimize themselves.
This whole system is an absolute clusterf*ck, it’s basically the NFTfication of Pokemon collecting, and they are trying to push the hobby in an Opensea-like space.
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Pretty sure your points 3 and 4 are why they reserve the right to cancel tokens at any time. They can still claim completeness of the ownership even if 20% of tokens are lost in the first 6 months. Wonder if that would then be a “legitimate” reason for altering the token amounts, values, or buyout percentages.
My card?
Our Card
1 Like
Here’s another website discussing this: Logan Paul Opens 'Tokenized Collectibles' Liquid Marketplace
This is the PR Logan Paul’s company has released:
“We want to make high-valued collectibles accessible to anyone interested in building their collection. To create a level playing field where those who truly appreciate these unique items can own something legendary.”
It’s laughable. How can you truly appreciate something you don’t actually own nor does the token represent the card?!
Guys I now own Logan Paul’s whole collection!.. well 50 cents of each card until he says I don’t own it.
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