Realio Founder: Why Am I Leaving the United States?

Author: Derek Boirun, Founder of the RWA tokenization project Realio

Compiled by: Heimi, Baize Research Institute

This summer, in 2023, I will be leaving the United States indefinitely. As a 42-year-old American citizen born and raised here, my sole purpose for doing this is to protect my constitutional rights, my family, and my company from excessive government intervention. It feels like a plot from a surreal novel, but this is my story.

I am the founder of the blockchain company Realio, which, as the name suggests, focuses on building digital infrastructure aimed at putting real-world assets (such as real estate) on the blockchain. We started building this company full-time in 2018 and invested a significant amount of time and money into its development. From the very beginning, our core focus has been on regulatory compliance, as investing in real-world assets, whether on the blockchain or not, typically requires adherence to securities laws. After all, investing in real estate is not new, and neither are securities laws, so doing this "on the blockchain" sounds very feasible.

Fast forward to 2022, after surviving the economic collapse caused by the COVID-19 pandemic (mainly due to the rapid growth of the crypto market), we were growing and optimistic about the compliant issuance of security tokens (tokens issued publicly under a legal and regulatory framework) by businesses on our platform. Because we believed compliance was achievable, we generally overlooked most of the narratives happening in the crypto industry, which also happened to be where most of the funding was going.

Many people became very wealthy by chasing "quick money," whether anonymously or not, but we held our ground. We even chose to "tokenize" our own company through a compliant security token offering. Fortunately, we managed to raise enough funds to sustain several years of development and construction. We are very grateful for the support provided by companies like Algorand, who invested in us through their token ALGO (just today, I had to hear Gary Gensler refer to ALGO as an unregistered illegal security). Without Algorand's generous investment and the price increase of ALGO, our financial situation could have been very different.

From 2020 to 2023, we spent most of our time on compliance.

We launched a "tokenized" fund and spent a lot of money hiring top lawyers to register the fund with the SEC under Regulation D. The money we spent on this was more than the entire operational budget of many startups. By the end of 2022, after multiple calls with SEC staff explaining our structure, we were ready to submit our registration documents. Then the FTX bankruptcy happened. Shortly after, through discussions with lawyers, I learned that the SEC was shutting down all registrations for "tokenized" funds seeking to obtain licenses. However, this was the only way we wanted to register or comply.

At the same time, we also applied for a Regulation CF portal license with the Financial Industry Regulatory Authority (FINRA), which is also a very expensive process… Like with the SEC, we had multiple calls with their staff to address all issues. However, after the FTX bankruptcy, FINRA requested a call with us to re-review our details.

We were prepared and sincerely answered all questions. However, we couldn't shake the feeling that this call was merely a "formality," with staff repeating basic questions over and over, seemingly to dissuade us or entrap us in some technical issue. After the call, we received a follow-up list of questions that were very broad and even exceeded the scope of our application. We were well aware that FINRA could drag this out for years, so we decided to put the application on hold until a new administration took office.

Most blockchain-based asset issuers actually have no registration pathway, not due to a lack of trying or compliance. I can attest that the regulatory behavior towards the crypto industry is neither fair nor friendly. I am familiar with the various strategies employed by regulators against us, typical "bureaucracy."

However, the talented individuals in the crypto industry are all striving to build a better global financial system. For us, this is not a game, nor is it politics. Many of us left traditional careers to do this. Now, we too are leaving the United States.

Money is the final battle for freedom. When you continue to control and manipulate us, we will not sit idly by. Despite your position, you do not have this power. You have no right to tell us what the market needs or does not need. This is precisely the kind of overreach we fought for independence to establish this country. Capital markets are being suffocated by regulation, which in reality protects no one but the wealthiest.

Leaving the United States is not easy either. I have a family that loves New York, among other things. But I have a duty to protect everything we have built, which means seeking a country that supports our continued construction.

We will not stop; we will continue to build the digital new world we have always been striving to create.