One of the first and most influential lawyers to represent blockchain and cryptocurrency businesses is joining one of the industry’s oldest startups in an executive role.
Announced today, Marco Santori is leaving Cooley LLP, where he’s been a partner since November 2016, to become the president and chief legal officer of Blockchain, a longtime client and one of the industry’s best-known wallet startups.
The move is a return to roots for Santori, who started out advising early bitcoin startups on legal and policy matters but over the years shifted to working on enterprise blockchains and, most recently, initial coin offerings.
But he said his heart was always in bitcoin’s potential to empower individuals.
“I didn’t get into this to do ICOs,” Santori told CoinDesk. “It’s a fascinating area of the law, but that’s not the train that I’m on.”
Likewise, he said:
“I’m not trying to rebuild Wall Street on top of a blockchain. I’m trying to give ordinary people a better option for finance, a better option for storing their funds and using their funds.”
Blockchain is the best place for him to fulfill that vision, Santori said. The company, which has offices in New York and London, allows users to store and send bitcoin through their web browsers without downloading any software.
It’s raised a total of $70 million to date. According to co-founder and CEO Peter Smith, the company has more than 20 million users.
Strategic role
Smith said Santori will play a strategic role, helping Blockchain meet the demand that exploded last year by scaling up not only the legal and regulatory functions but also corporate development, including acquisitions and partnerships.
“In our space, it’s so special: go-to-market strategies and acquisition strategies are all reliant on the regulatory and legal side,” Smith told CoinDesk. “Having someone come out of that vertical who understands how to run deals is very key.”
Santori is uniquely suited for such a role, having been on “at least one side of every major transaction in the digital currency space over the last four years,” Smith said.
The chief legal officer position is newly created. The president’s title previously belonged to Blockchain co-founder Nic Cary, who will maintain an active role as vice chairman, focusing on public affairs and external relations as Santori takes over the policy and expansion duties, a company spokeswoman said.
Cary said in a press release that he will be “dedicating more of my time [to] building our brand in key regions like India, hiring the brightest talent, and educating more people on the benefits of digital assets.”
A long, strange trip
In many ways, Santori’s career has mirrored the blockchain industry’s evolution.
He first made a name for himself as a bitcoin-savvy lawyer while working at Nesenoff & Miltenberg LLP. In 2013, he became the chairman of regulatory affairs committee at the Bitcoin Foundation and the following year represented the trade group during the New York State Department of Financial Services’ BitLicense hearings, watched across the globe.
In late 2014, he joined the white-shoe firm of Pillsbury Winthrop Shaw Pittman LLP, and simultaneously was retained as global policy counsel for Blockchain. Santori made partner at Pillsbury two years later.
This period coincided with a long bear market for bitcoin. The industry’s focus turned to seeking ways corporations and governments could take advantage of the underlying technology without having to touch the currency.
During that era, Santori was a key figure in shaping the state of Delaware’s blockchain strategy. He helped to craft legislation that allowed firms incorporated in the First State to record their shares on a distributed ledger.
At Cooley, where Santori’s been a partner since November 2016, his work has centered around ICOs, which took off like a rocket last year, despite the legal uncertainties surrounding these token sales.
ICO controversies
Santori tried to bring some clarity to the market last year with the SAFT, or Simple Agreement for Future Tokens.
In this structure, a blockchain project raises money exclusively from accredited investors, thereby avoiding securities registration requirements; once a network or product is built, the tokens needed to use it are distributed to the investors, who can resell them to the public.
The SAFT idea has been controversial, with some legal scholars fearing it may have the opposite effect from its intent and increase the legal risk for token issues.
Meanwhile, the U.S. Securities and Exchange Commission and other regulators around the globe have begun cracking down on ICOs. And last month, without naming any names, SEC chairman Jay Clayton voiced disapproval of lawyers who have been advising ICOs that resemble securities offerings but don’t comply with the securities laws.
Santori said his move to Blockchain was in the works long before Clayton made those remarks. As for the remarks themselves, he gave a very lawyerly response.
“The SEC and the bar are in a learning process about how these things ought to be treated, about where the value is, where the risk is,” Santori said, adding:
“Regulators all around the world are responding primarily to headlines. There’s been a failure on the part of the industry and the bar to explain the value to regulators. We all have a lot of work to do together.”
Santori said his departure from Cooley is bittersweet, since he hasn’t finished building the firm’s fintech practice, but there aren’t enough hours in the day to do that and perform his new duties at Blockchain.
“I wish I could do both,” he said.
Image via Marco Santori