SEC Provides Guidance on the Applicability of Securities Laws to ICOs and Sales of Digital Tokens – The Beginning of a “Safe Harbor”
In regard to coins as an investment, here is an interesting question: What are some of the factors the SEC would consider in assessing whether a digital asset is offered as an investment contract, making it a security?
In this Blockchain + The Law article, William Hinman, Director, Division of Corporate Finance, provides guidance on the applicability of U.S. Federal Securities Laws to Initial Coin Offerings (ICOs) and the sale of digital tokens.
Director Hinman confirmed in detail that the SEC will continue to apply the “Howey Test” in determining whether the sale of “tokens” amount to the issuance of a security. If you have any question on your tax liability on an ICO investment, this article and the director’s full presentation (linked) may provide some valuable answers.