INTRODUCING ERC-S

Summary from the TLDR Crypto newsletter

Street's ERC-S is a solution to ERC-20 tokens' lack of intrinsic value and difficulty validating multi-billion dollar FDVs through governance or utility alone, creating the first possibility for tokenizing startups like OpenAI and SpaceX without securities classification under the Howey Test. The standard enables exposure to startup economic upside through an operational flow where operating companies route discretionary payments to SPV/Foundation shareholders, who then distribute to tokenholders via DAO governance with transparent operations and automatic pause triggers during disputes. ERC-S addresses wrapper token failures, including redemption bank-run dynamics, governance capture risks, and unclear enforceability, by anchoring value in actual equity ownership at the company layer while keeping tokenholders outside the buyer's transaction perimeter during exits. The framework includes a 20-module scenario library that standardizes applications across launch, operations, and exit phases, enabling startups to raise millions and bootstrap thousands of users without selling equity while allowing later-stage companies to avoid synthetic platforms like Robinhood that cost them billions in weekly revenue through natural price discovery and direct tokenization.