October 20th 2018
In this guide, we explain the steps to participate and invest in a Security Token Offering led by Mt Pelerin.
In the STO process, shares or certificates of the issuers are sold in the forms of tokens. A token is a digital unit of value, and in most cases one token equals one share or certificate.
In order to receive and store such tokens you need a digital wallet, like cash would be stored in a physical wallet.
If you already know all about mnemonics, private keys and hardware wallets, you can skip this step and go to step 2.
If this is new for you, please read on.
A digital wallet takes the form of an address (the public key) used to send and receive transactions, just like an email address lets you send and receive messages. Like an email, you need a password to access and control your digital wallet: the private key.
THE SAFEKEEPING OF THE PRIVATE KEY IS PARAMOUNT!
Unlike the password of a mailbox, if a private key is lost it cannot be recovered, as nobody else than yourself has control over it. A private key is also too long and complex to be committed to memory, so a good storage strategy is key.
There are 3 ways to store a private key:
The most secure is the hardware wallet, simply because its chip is designed to hold the keys and never expose them to the internet nor to another device. Any message or transaction that needs your keys will be sent to the device, signed by the keys within the chip, and sent back out, with the keys never revealed.
The less secure of all is any form of encrypted file on your computer, since you will have to type a password to decrypt your key, and with so many viruses able to capture keystrokes and steal files, you’re just one malicious email-attachment away from losing your key.
When you manually write your key to a piece of paper, or better yet on a more durable support, it usually takes the form of a “mnemonic”. This form is typically 12 words from the english dictionary, which are sufficient to fully recover the original private key, and are the preferred way to store a backup of your private key, which you should hide in a different location.
Naturally, Mt Pelerin recommends the use of a hardware wallet, with a backup mnemonic store in a safe alternate location. But if you do not have a hardware wallet yet, we recommend that you start with a MetaMask account (which will store an encrypted copy of your private keys on your computer), which you can then continue using with your hardware wallet later on, simply by connecting your device (Ledger or Trezor) to your computer and click a button in MetaMask.
At that point you can either discard your old MetaMask-created address once you transferred everything to your hardware wallet, or keep a small amount of funds in it as a “hot wallet” to access Dapps. The advantage is that MetaMask is easy to use, eases access to Dapps and is compatible with MyCrypto for more advanced needs.
If you do not know how to create a wallet, here is a guide explaining how to do so using MetaMask:How to Create a Wallet with MetaMask
Investing in an STO requires us to proceed to the verification of your identity, a process that is defined by Swiss regulation.
To do so, please go to the company's STO investment page, fill all the requested information and submit the form. Please have a copy of an ID document and a copy of a proof of address ready with you, as well as your Ethereum wallet address.
After submitting the form, a member of our staff will review your information. If they check out, you will receive an email for the next step.
Depending on the amount of your investment, a member of our staff may contact you to arrange a short video call (that you can do from a computer or from your phone) in order to complete your identity verification.
If the information you submitted in your registration form is approved by our staff, you will receive an email.
In this email, you will have the links to the sale documents that we you need to read.
You will also have a button on which you need to click to access the Share Purchase Agreement (SPA). You are required to read it and accept it.
Once you will have accepted the Share Purchase Agreement, the payment information will be displayed on the same page. You can then proceed to the payment of your investment whithin the dates of the sale.
You can send your funds to us in two ways:
For safety reasons, payment information will not be displayed anywhere else than on the sale documents page. Do not trust any other source nor private messages - they will try to scam you and steal your money. A transaction on the blockchain is irreversible and your funds are lost if sent to the wrong address.
To finalize your investment in fiat, please select the appropriate IBAN for the chosen currency and make a payment of the desired amount. The payment must reach our bank before the end of the sale and it absolutely must originate from your own bank account.
To finalize your investment in ETH, you should send your ETH investment in a transaction directed towards the sale smart contract. You will receive in return the corresponding amount of MPS tokens.
It may happen that your tokens get delivered but something is still missing in your KYC profile. Only Mt Pelerin KYC operators and technical staff are authorized to contact you for these matters, always by email first. Please always check the email address thoroughly, verifying that it is genuine, with the domain @mtpelerin.com. In any case we will never, ever ask you to reveal any password, private key or mnemonic, and if anyone does, it means they are trying to scam you and are probably impersonating one of us.
A note on currency exchange and rates: The rates for fiat currency exchange are calculated by our bank, we will take the resulting CHF value and use it to send a transaction to the tokensale smart contract, which will deliver the tokens to the ethereum address you declared during KYC.
The rates for ETH are calculated from cryptocompare.com data, using the ETHUSD pair on a 24h moving average, every day at noon, updated in the smart contract within four hours (usually less than 60 minutes). Cryptocompare provides an index, meaning the rate is compounded from all major exchanges. We use the USD rate because it represents the largest liquidity and is thus more representative (ETHCHF is only traded on a single exchange to date), we then obtain the final ETHCHF rate by using a reputable source for the 24h MA on USDCHF.
Exception: The invitational round will have its rate fixed on the starting day for the whole duration, and will use a 7-day MA instead of 24h.
Unless your investment amount is exactly a multiple of the token price once converted to CHF, there will be rounding errors, when there is a remainder of a fraction of a token. This means that in the worst case scenario you risk leaving 4.99 CHF in the smart contract, in the form of ETH. That amount will be added to your next investment if you decide to add more funds, or you can withdraw it at any time using the guide available here at the end of the sale.
Explanation: The sold token has zero decimals. This mirrors the fact that shares are indivisible. It means that any smart contract manipulating tokens and performing divisions on it will necessarily be affected by rounding errors. For example, if a smart contract is coded to send out a third of the tokens it receives to each of 3 addresses, and you send it 100 tokens, it will divide 100 by 3, getting 33.33333 and all the decimals will be truncated, resulting in exactly 33 tokens sent to each address. One token will remain in the smart contract and can only be extracted by some other mean, or by sending 2 more tokens to make the remainder divisible by 3. This last fix is useful in many cases, but in other cases it may be impractical or require enormous amounts of tokens to reach a divisible number.
Congratulations, you can now invest in an STO!