Feb. 15, 2019
This week we introduced Level - a new crypto exchange based on a flat fee model and designed with the input of influential advisors. After months of working in stealth mode, we were excited to finally share what we’ve been working on with Crypto Twitter. We try to listen to customer feedback, whether positive or not, and a common sentiment was hard to ignore:
Why are all these advisors shilling another exchange?
This is a completely fair question, we think we understand why it's being asked, and we respect your right to reach your own conclusion about our business and ethics. We hope this article helps to clarify how we work with advisors.
We've seen shills and token advisors attach their names to ICO projects, adding credibility to the team and vouching for the long-term prospects of the project. In return, these advisors have been compensated short-term in cash or tokens. The mismatch between incentive structures has led to poor results. It’s worth noting that when a token advisor shills, they may also be acting as illegal Investment Advisors under US Securities Law. In this sense, tokens are analagous to penny stocks, and advisors analagous to "boiler rooms."
Level is an equity company and not a token project. We don’t have a token, and we will never have an ICO. Our team members, both employees and advisors, are equity owners in the business. And advisors specifically are never compensated in cash or crypto.
Advising an equity company is different from a token business. Yes, advisors may profit in the long-term if the company creates value but get nothing unless the company receives private equity investment, becomes publicly listed, or gets acquired. All of these outcomes require the same thing: delivering on the business's promise to customers. Equity advisors, by the nature of their incentive structure, must believe in the vision and team, and contribute value to end users, to realize any return on their involvement.
We take this extremely seriously at Level. More advisors wanted to be involved in Level than are currently involved. When advising recruits asked for cash, we didn’t hire them. When advisors joined the team and then pushed for short term compensation, we fired them. And the team that formed is a team we believe is dedicated to accomplishing our mission.
We welcome scrutiny from the customers we serve on every aspect of our operations. At Level, we know trust isn't expected, must always be earned, and can never be taken for granted. We look forward to working every day to earn your trust.