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SEC called and said your token is a security. This framework isn't much of a surprise, and is pretty conservative. Not much room for utility tokens, with the exception of perhaps stable utility tokens. Even giving away tokens via bounties or airdrops is a potential sale of securities, footnote 9: "airdrop may constitute a sale or distribution of securities". Does this mean you need to register your token as a security before giving it away via an airdrop? This makes me miss the days of speculating about what is and isn't a utility token with Token Foundry a year ago... :\

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slava

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@slava • 5 Years Ago

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SEC called and said your token is a security. This framework isn't much of a surprise, and is pretty conservative. Not much room for utility tokens, with the exception of perhaps stable utility tokens. Even giving away tokens via bounties or airdrops is a potential sale of securities, footnote 9: "airdrop may constitute a sale or distribution of securities". Does this mean you need to register your token as a security before giving it away via an airdrop? This makes me miss the days of speculating about what is and isn't a utility token with Token Foundry a year ago... :\

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This is an interesting point: [https://twitter.com/lwsnbaker/status/1113548296629317632](https://twitter.com/lwsnbaker/status/1113548296629317632) SEC seems to have glossed over one aspect of the Howey Test: Investment in a Common Enterprise. Common Enterprise is meant to imply that all investors and promoter profit equally from the appreciation of the token but the definition is vague. A work token with some price-stabilizing mechanisms may be a good candidate for a non-Common Enterprise case.

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This is an interesting point: [https://twitter.com/lwsnbaker/status/1113548296629317632](https://twitter.com/lwsnbaker/status/1113548296629317632) SEC seems to have glossed over one aspect of the Howey Test: Investment in a Common Enterprise. Common Enterprise is meant to imply that all investors and promoter profit equally from the appreciation of the token but the definition is vague. A work token with some price-stabilizing mechanisms may be a good candidate for a non-Common Enterprise case.