SEC staff issued new guidance Thursday clarifying how token buybacks, staking receipt tokens and blockchain development may be treated under federal securities laws. These FAQs, published by the SEC’s Division of Corporation Finance, specify that announcing a buyback of a non-security crypto asset on an already functional network would not by itself amount to a promise of essential managerial efforts under the Howey test. Liquid staking receipt tokens can be treated as a digital tool when serving as a receipt for the underlying asset, and developers can continue maintaining and improving a functional network without those activities necessarily constituting essential managerial efforts. This guidance does not carry the force of law and has not been approved or disapproved by the Commission.
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