SEC Chair Paul Atkins Reveals Which Crypto Tokens He Thinks Are Securities

Core Viewpoint - SEC Chair Paul Atkins clarified the regulatory stance on crypto tokens, indicating that many popular tokens may not be classified as securities under SEC jurisdiction [1][4]. Group 1: Categories of Crypto Tokens - Certain categories of crypto tokens, such as "network tokens" linked to decentralized blockchain networks, are not considered securities [2]. - "Digital collectibles," which represent rights to media or reference internet memes and trends, are also exempt from SEC regulation [3]. - "Digital tools," which provide practical functions like tickets or memberships, are classified as non-securities [3]. Group 2: SEC's Regulatory Approach - Atkins emphasized that an asset should only be deemed a security if third-party managerial efforts are essential to its future value [4]. - Most crypto tokens are purchased with the expectation of future profits, but they will not be classified as securities unless purchasers expect profits from the managerial efforts of others [5]. - If a crypto token qualifies as an investment contract, it could revert to a non-security status if the issuer fulfills or fails to meet their promises [5]. Group 3: Tokenized Securities - Tokenized securities, which represent already regulated securities trading on-chain, will continue to be regulated by the SEC [5].