U.S. SEC states functional crypto not an investment contract based on support alone

The U.S. SEC’s Division of Corporation Finance published an FAQ on Sept. 25 regarding the application of federal securities laws to crypto assets. The FAQ indicates that once a crypto system is sufficiently functional, ongoing support from issuers or related parties for security, maintenance, or user growth is unlikely to be considered an investment contract aimed at increasing token prices. Additionally, if no party centrally controls the system, statements from issuers about future developments are unlikely to create a new investment contract. The SEC also noted that buyback plans for functional crypto assets generally do not constitute an investment contract, although this could change if the system is not sufficiently functional and the buyback is marketed as a profit-generating opportunity for token holders. The FAQ represents the views of the Division of Corporation Finance staff and is not an official SEC rule or regulation, thus not legally binding.

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