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Ya, I’ve been following the Howey Test and SECs read on it since ‘17 when it really started to surface with ICOs. You copy/pasted the types of speeches I’m ref

Ya, I’ve been following the Howey Test and SECs read on it since ‘17 when it really started to surface with ICOs. You copy/pasted the types of speeches I’m referring to. “everything in crypto with a live issuer behind it is probably a security.”… This claim is still a massive overstatement from a regulation-informed perspective. Everything in crypto extends beyond “much of the NFT” market. In ‘18, SEC chairman says ETH and BTC aren’t securities. Pre-merge, eth wasn’t a security to Gensler. Post-merge, it was. So then what about the many ETH-clones that didn’t do PoS and stuck with PoW/not-a-security ETH design. Also, “eth might be a security” came up in Sept ‘22. SEC and the chairman have changed minds in significant ways within that time period many times over since ‘09 and the whitepaper. It’s nowhere near cut and dry as you’re making it to be, but I won’t devolve into an argument about it and instead say there’s more info to this than your views indicate you’ve researched.

Animats 4y ago
Maybe not "everything". The crypto people have desperately tried to invent things they can claim are not securities. Post-FTX, and post SEC vs LBRY, that's not going to work. The original theory behind NFTs was that they were "collectable art". But then they started looking a lot like securities, with collections, series, "floor prices", fractional ownership, secondary markets, and such. See [1] The US test for whether something is a security is use, not form. If there's a billion dollar market in trading buttons, it becomes a security. There are NFTs representing land in virtual worlds. Most of the sellers sold land before actually getting the virtual world working. That's a clearly a speculative investment which depends upon on the promoters finishing the project. This is exactly like selling real land in a not yet built subdivision, which is a security offering in the US. See "Swampland in Florida" in Wikipedia. (Although China allows this; there are people stuck paying mortgages on unbuilt buildings, which is not going well.) There's the DAO concept, where the token holders own the thing and can vote on running it. That looks a lot like a stock IPO in the early stages. In the later stages, when all tokens have been sold, there's an unexpected kicker. Owners of the DAO may be personally liable for its losses.[2] Not just for the amount they paid. A DAO is a partnership or unincorporated association, and debts pass through to the members. [1] https://www.pymnts.com/nfts/2022/pymnts-nft-series-can-nfts-be-securities-the-sec-says-yes/ https://www.pymnts.com/nfts/2022/pymnts-nft-series-can-nfts-... [2] https://www.jdsupra.com/legalnews/voter-beware-personal-liability-for-dao-7040503 https://www.jdsupra.com/legalnews/voter-beware-personal-liab...

Animats 4y ago

Maybe not "everything". The crypto people have desperately tried to invent things they can claim are not securities. Post-FTX, and post SEC vs LBRY, that's not going to work. The original theory behind NFTs was that they were "collectable art". But then they started looking a lot like securities, with collections, series, "floor prices", fractional ownership, secondary markets, and such. See [1] The US test for whether something is a security is use, not form. If there's a billion dollar market in trading buttons, it becomes a security. There are NFTs representing land in virtual worlds. Most of the sellers sold land before actually getting the virtual world working. That's a clearly a speculative investment which depends upon on the promoters finishing the project. This is exactly like selling real land in a not yet built subdivision, which is a security offering in the US. See "Swampland in Florida" in Wikipedia. (Although China allows this; there are people stuck paying mortgages on unbuilt buildings, which is not going well.) There's the DAO concept, where the token holders own the thing and can vote on running it. That looks a lot like a stock IPO in the early stages. In the later stages, when all tokens have been sold, there's an unexpected kicker. Owners of the DAO may be personally liable for its losses.[2] Not just for the amount they paid. A DAO is a partnership or unincorporated association, and debts pass through to the members. [1] https://www.pymnts.com/nfts/2022/pymnts-nft-series-can-nfts-be-securities-the-sec-says-yes/ https://www.pymnts.com/nfts/2022/pymnts-nft-series-can-nfts-... [2] https://www.jdsupra.com/legalnews/voter-beware-personal-liability-for-dao-7040503 https://www.jdsupra.com/legalnews/voter-beware-personal-liab...