Missing an expected token launch date does not automatically mean breach: Kelman

Kelman PLLC, a law firm focused on digital assets, said an investor’s failure to receive tokens after a project’s expected launch date has passed does not automatically constitute a breach of contract. Whether a breach has actually occurred depends on whether the token delivery timing and payment conditions specified in the contract have been met, Kelman said. The firm pointed in particular to early-stage investments made through SAFTs, or Simple Agreements for Future Tokens. Under a SAFT, an investor provides funding in advance and gains the right to receive tokens once predetermined conditions are satisfied. Unlike general token sales such as ICOs, IEOs, or launchpads, a project’s obligation to deliver tokens is determined by the specific terms agreed between the investor and the project, according to Kelman. If a project seeks to change terms by delaying token delivery, reducing the allocation, or extending the vesting period, investors should check whether the existing contract allows such changes and whether investor consent is required, the firm added. Kelman also said related materials should be preserved, including contracts, remittance records, transaction hashes, and project announcements and messages.