Blockworks' founder Mike Ippolito recently shared a post on X:

"I no longer believe dual equity token structures are workable. The success stories are vanishingly small and dwindling by the day. My base case is they stick around, but investors apply an increasingly higher discount due to uncertainty. Why buy something which could be rugged at any point via an infinite number of edge cases, against which you have no legal protection? If you're an issuer, your choices are to either bite the bullet now and choose equity vs token, or slowly bleed out."

We agree, and it points at something the Token Transparency Filing (TTF) can fix. The discount he describes has two parts. One is structural; the risk that the token has no real claim on value. The other is uncertainty; that an investor cannot tell what claim the token has in the first place. 

The structural part is the issuer's choice. The uncertainty part is a legibility issue, and the TTF can help reduce it. Whether the token or some other instrument holds the claim on the value is the hardest thing to synthesize and understand in a TTF today.

“Ownership” is defined across several categories and knowing whether the token is an ownership asset is never asked outright. Does the token have a claim on the value, or does an equity entity capture it?

The TTFs span structures at opposite ends of the ownership spectrum. At one end are projects that are hard to understand without a background in corporate finance. At the other end are ownership coins, where the token is the only asset and there is no separate equity to account for. The two ends of the spectrum take very different effort to understand. Some of that gap could be scale, since larger projects add entities and agreements over time - but the simpler the structure, the less a reader has to unpack when they make an investment decision.

A disclosure standard meant to make tokens investable could make ownership legible in one place. An Ownership and Value Capture section with five items would accomplish this:

  1. Entity map - A diagram of the legal entities in the structure, showing which one holds the IP, brand, treasury, and revenue.
  2. Value instruments - If the token is the exclusive instrument, or not. If not, disclose parallel instruments (equity, SAFEs, token warrants) and who holds it.
  3. Value flows that bypass the token - Any fees, revenue, or proceeds accruing to an OpCo, foundation, or anyone else other than holders. The B-2 operational funding section collects these flows by entity, but it never requires stating which ones bypass holders. 
  4. The token claim - What holding the token contractually entitles you to in the moments that matter (acquisition, licensing, IP sale, treasury distribution, etc.).
  5. Enforcement - Whether those flows are default and programmatic or discretionary and who can change them.

These surface value leakage into a single section and turn "this token has no claim to anything" into a disclosure. For token holders this is the most valuable thing to know and least likely to be volunteered by an issuer.

For ownership coins this section is simple. It matters a lot more for the tokens that do not grant ownership. Those are the ones whose holders learn about the structure the hard way, in an acquisition, a privatization, or a fee redirection they have no control over.

Beyond Blockworks

Any token holder can ask the ownership and value accrual questions above before investing. A team that can answer these quickly is telling you something. Same with a team that cannot.

Disclosure standards stick when capital demands them. If holders ask these questions before committing, and encourage the teams they back (or want to back) to file a TTF, the standards improve from all angles.

Conclusion

Mike Ippolito's framing is that issuers should choose equity or token. The direction is absolutely right, and it will take time. Most teams have both today, and that will not collapse to a single value accruing asset overnight. So the near term job has two parts (1) encourage projects toward a single value accruing asset, and where they keep both, (2) make the relationship legible. 

The ownership section should be where a project discloses how equity and token relate. Which instrument holds the claim on what, who owns each, and how value moves between them. A maintained financial record then verifies it. That is the work we are doing at 01Resolved and where we can help raise the standards.