Skip to content

LeXcheX: On-Chain Accredited Investor Verification

LeXcheX is MetaLeX Labs’ solution for automating and tokenizing the verification of “accredited investor” status entirely on-chain. It streamlines U.S. securities law compliance (specifically Regulation D, Rules 506(b) and 506(c)) by replacing cumbersome paper processes and invasive KYC with a blockchain-based certification. In essence, LeXcheX enables startups and DAOs to “raise in public” (general solicitation under Rule 506(c)) while ensuring that only verified accredited investors can ultimately purchase the securities. It can also be used in private fundraising (Rule 506(b)) to bolster due diligence on investors without traditional paperwork. The service exemplifies MetaLeX’s mission to fuse autonomous software with legal structures, making it possible to raise capital with just a few on-chain clicks – with compliance built in.

How the LeXcheX Process Works

LeXcheX combines smart contracts, off-chain oracles, and legal agreements to issue a tamper-proof Accredited Investor Certificate. The process is simple for the user and consists of three main steps:

  1. Investor Questionnaire: The user connects their wallet and provides basic info about their investor status (e.g. individual vs. entity). They indicate how they qualify as accredited – for example, by net worth over $1 million (since income can’t be verified on-chain). Basic details like name, entity type, and jurisdiction are collected at this stage for inclusion in the legal certification.

  2. On-Chain Wealth Evaluation: LeXcheX then evaluates the investor’s on-chain asset holdings to test the net worth criterion. It utilizes an oracle service (a dedicated TypeScript server) that queries the wallet’s balances via the Zapper API. If the automated test finds that the user’s blockchain portfolio meets the threshold (e.g. >= $1,000,000 in crypto assets), the investor passes this step. Notably, this is done without invasive KYC – no uploading bank statements or personal IDs – just a read of on-chain balances. (The oracle is designed to check not only asset value but also potentially a 12-month holding period, to satisfy the net-worth test’s requirements.)

  3. On-Chain Agreement & NFT Issuance: If the asset check is successful, the investor then signs a “cybernetic” legal agreement entirely on-chain, directly from their wallet. This EIP-712 signature serves as a digital representation of the investor’s representations and warranties (essentially, a promise that they are indeed accredited and the information is true). Once the agreement is signed, the smart contract (controlled by a U.S. licensed attorney) mints a non-transferable NFT certificate to the investor’s wallet as proof of accredited status. The investor pays a service fee of $100 (in USDC) to MetaLeX as part of this minting. The entire process – from asset verification to legal signature and certificate issuance – happens on-chain in a few clicks, with no paper or manual review needed.

Soulbound NFT Certificate and Legal Significance

The output of LeXcheX is a soulbound (non-transferable) NFT certificate that serves as an attorney-signed “accredited investor letter.” Technically, this certificate is implemented as an ERC-721 token with modifications for soulbound behavior (using the ERC-5484 and ERC-5192 standards). Once issued, it cannot be sold or transferred – it is permanently bound to the investor’s address (unless revoked or burned). The NFT’s metadata contains the investor’s name, entity type, jurisdiction, and a unique agreement ID, along with a stylized SVG image of the certificate. The image itself displays key information: it prominently declares “U.S. Accredited Investor”, indicates that the holder of the certificate is an accredited investor, states who certified it (e.g. “Certified by Gabriel Shapiro, Esq., of MetaLeX”), and shows an expiration date. This means an actual licensed attorney (MetaLeX’s counsel) is effectively signing off on the NFT – akin to a traditional lawyer’s letter vouching for the investor’s status, but now in smart-contract form. The certificate is digitally signed and recorded on-chain, so anyone can cryptographically verify its authenticity and validity period.

The LeXcheX Accredited Investor Certificate (soulbound NFT) is a tokenized attorney’s letter confirming the holder’s accredited status. The certificate is emblazoned with “U.S. Accredited Investor,” marked as certified by MetaLeX’s attorney, and includes an expiration date and a unique agreement reference. It is explicitly labeled non-transferable and soul-bound, emphasizing its personal, compliance-oriented nature.

Each LeXcheX certificate comes with a validity period of 90 days (approximately three months). This aligns with U.S. SEC guidelines, which suggest that accredited investor verifications should be refreshed every 3 months for Rule 506(c) offerings. After the 90-day period, the NFT is considered expired (the smart contract can mark it invalid) and anyone may trigger a revocation of the token on-chain. Investors can easily renew their certificate by re-running the on-chain checks and paying the fee again for another 90-day extension, provided they still meet the requirements. The NFT also includes an admin-controlled revocation mechanism: if it turns out an investor misrepresented themselves or an error occurred, the contract owner (attorney) can revoke the certificate at any time, which burns the token and blacklists the address. These features ensure that only valid, up-to-date accreditations persist in the system.

From a legal perspective, companies can rely on a LeXcheX NFT the same way they would rely on a traditional lawyer’s accreditation letter. Under SEC Rule 506(c), an issuer is deemed compliant if they take “reasonable steps to verify” purchasers’ accredited status – obtaining a third-party attorney’s certification letter is one accepted method. LeXcheX implements the “lawyer letter” method on-chain: by having an attorney oversee the process and effectively sign the NFT, the certificate evidences that “reasonable steps” were taken to verify the holder’s status. The NFT can be presented to fundraising platforms or token sale contracts, which can programmatically check that the wallet holds a valid accredited-investor NFT before letting them invest. This opens the door for public fundraising (general advertising of an investment round) without fear of accidentally selling to unverified investors. In private rounds under Rule 506(b), the NFT is not legally required, but it still provides a convenient assurance (for example, a startup could request investors to obtain LeXcheX certificates as an added layer of diligence).

Integration with Fundraising Platforms

MetaLeX Integration

LeXcheX is fully integrated into MetaLeX’s cyberCORPS on-chain fundraising dApp. CyberCORPS is an early-stage financing platform that allows startups (organized as on-chain “cyber corporations”) to raise capital by selling tokens or shares. With the LeXcheX integration, a startup using cyberCORPS can toggle a setting to require accredited status for their round. In the offering setup form, the issuer simply checks the option **“Require LeXcheX Accredited Investor Status”. This ensures that only investors who hold a valid LeXcheX NFT certificate can participate in the sale. The platform’s smart contracts or front-end will verify the investor’s address against the LeXcheX ERC-721 contract. If an investor has not yet obtained their certificate, the interface can direct them to the LeXcheX application (at lexchex.metalex.tech) to go through the verification flow before investing. This seamless integration means founders can confidently advertise their raise (506(c) general solicitation) knowing that all actual investors will be gated by LeXcheX compliance checks. It effectively bakes compliance into the fundraising smart contract: unverified participants are filtered out, and only wallets with attorney-approved accreditation tokens can send funds or receive securities.

By combining cyberCORPS with LeXcheX, MetaLeX delivers an end-to-end on-chain fundraising solution that is both highly technical and deeply legal. The technical side provides automation, efficiency, and trustlessness (smart contracts, oracles, NFTs), while the legal side ensures adherence to U.S. securities laws (verification of investor status, record-keeping of investor acknowledgments, attorney oversight). The result is a novel mechanism where raising capital becomes as straightforward as issuing a token, and compliance is handled in parallel by code and cryptography. LeXcheX not only simplifies life for founders and investors by skipping the paperwork, but it also stands as a pioneering example of using blockchain tech to solve real regulatory challenges in a provably compliant way. LeXcheX makes conducting an SEC-compliant offering a breeze – founders can focus on building and promotion, while the protocol ensures that only verified accredited investors end up holding the sale tokens. This integration of law + code is a cornerstone of MetaLeX’s approach to making organizations “cyBernetic”, and it positions cyberCORPS and LeXcheX as critical components of the on-chain capital markets infrastructure.

Third-Party Integrations

LeXcheX is designed to be highly friendly to third-party integration.

Technical Integration Guide

LeXcheX is deployed across multiple chains to support various blockchain ecosystems. The contract address is the same on all supported networks:

LexCheX: 0x123E895e0e1a4e39b2E0488DB904AD37C7A62EeD;

Checking Accreditation Status

To verify if an address has a valid LeXcheX accreditation, you can use the following function:

function hasValidLexCheX(address owner) public view returns (bool)

This function returns:

  • true if the address has a valid, non-expired LeXcheX accreditation
  • false if the address either has no LeXcheX token or if their accreditation has expired

Example usage in a smart contract:

// SPDX-License-Identifier: MIT
pragma solidity ^0.8.28;
 
interface ILexCheX {
    function hasValidLexCheX(address owner) external view returns (bool);
}
 
contract YourContract {
    ILexCheX constant lexchex = ILexCheX(0x123E895e0e1a4e39b2E0488DB904AD37C7A62EeD);
    
    function testFunction(address investor) public view {
        if(!lexchex.hasValidLexCheX(investor)) revert NotAccredited();
        // ... rest of your function
    }
}

Here are examples using popular JavaScript/TypeScript libraries:

Viem
import { createPublicClient, http } from 'viem'
import { mainnet } from 'viem/chains'
 
const LEXCHEX_ADDRESS = '0x123E895e0e1a4e39b2E0488DB904AD37C7A62EeD'
const LEXCHEX_ABI = [{
  name: 'hasValidLexCheX',
  type: 'function',
  stateMutability: 'view',
  inputs: [{ name: 'owner', type: 'address' }],
  outputs: [{ name: '', type: 'bool' }]
}] as const
 
const client = createPublicClient({
  chain: mainnet,
  transport: http()
})
 
// Check if an address has valid accreditation
const checkAccreditation = async (address: string) => {
  const isAccredited = await client.readContract({
    address: LEXCHEX_ADDRESS,
    abi: LEXCHEX_ABI,
    functionName: 'hasValidLexCheX',
    args: [address]
  })
  
  return isAccredited
}
Ethers.js
import { ethers } from 'ethers'
 
const LEXCHEX_ADDRESS = '0x123E895e0e1a4e39b2E0488DB904AD37C7A62EeD'
const LEXCHEX_ABI = [
  'function hasValidLexCheX(address owner) view returns (bool)'
]
 
// Using ethers v6
const provider = new ethers.JsonRpcProvider('YOUR_RPC_URL')
const lexchex = new ethers.Contract(LEXCHEX_ADDRESS, LEXCHEX_ABI, provider)
 
// Check if an address has valid accreditation
const checkAccreditation = async (address: string) => {
  const isAccredited = await lexchex.hasValidLexCheX(address)
  return isAccredited
}
Sources: