Chia Network Inc, intends to build a blockchain via an eventually public, for-profit, open source development company that holds a pre-farm (equivalent to a pre-mine) of chia coins. The Strategic Reserve (pre-farm) is 21 million chia at launch and is placed on their balance sheet. The company will list its equity on a national stock exchange with a view to providing credibility and thus confidence in its open source software support business with governments, financial institutions etc. It is thought the the value of the company will initially refelect the value of chia held on its balance sheet. The blockchain and externally farmed coins will trade and work independantly of the company. The Company believes this will help differentiate the commodity treatment of chia coins from the publicly listed Chia Network Inc. equity.

The Company will not sell chia from the strategic reserve.

The company intends to use the Strategic Reserve for purpose like: lending chia to governments, financial institutions, market makers and enterprises. Generally to expand the functionality and reach of chia. Potentially adding additional farming rewards to farmers or developers as an incentive to promote the blockchain engine. The Strategic Reserve is designed to create a long term, sustainable method to fund the ongoing development and deployment of the Chia Network blockchain.

Chia Network Inc intend to put checks and balances in place to prevent offloading of the strategic reserve to the market in an adhoc manner. Some of these measures include the transparency and regulatory infrastructure of the company, requirements of board approval of independent directors on any decisions without a 90-day notice to the public and smart coin use to limit total availability to a vesting schedule

The Company may use smart coins to limit the total availability of the pre-farmed chia to a vesting schedule once it is able to put it’s more sophisticated custody system in place. Additionally, the Company intends to set up internal controls so that its commitments to investors and coin users will require board approval of our independent directors and not be subject to any single shareholder’s ability to control Chia Network’s Strategic Reserve. The Company also plans to adopt certain assurances that it will not make changes to, as an example, its commitment to not sell chia coins from Chia Network’s Strategic Reserve without 90-days’ notice to the public. Further the Company does not intend to invest chia coins or dividend coins to shareholders, or use coins to repurchase equity until after we are a reporting company.

Farmers and developers should be given the ability to invest as shareholders and thus own a portion of the strategic reserve and the protection that affords. This should align all interests and enable farmers, enterprise customers and third parties to hedge between company share equity and chia coin ownership.

More info from the Chia Business White Paper.

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