Name a Notable SEC Enforcement Action Based on the Howey Test for an ICO.
The SEC action against Telegram's TON (Telegram Open Network) ICO is a prominent example. The SEC successfully argued that the sale of Gram tokens constituted an unregistered securities offering, applying the Howey Test.
The court issued an injunction preventing the distribution of the tokens, even to non-US investors, highlighting the SEC's broad reach. This case reinforced the view that the Howey Test applies robustly to digital assets, regardless of the issuer's intent or the token's proposed utility.
Glossar
Sec Action
Action ⎊ In cryptocurrency derivatives and options trading, 'Sec Action' broadly denotes any regulatory intervention or enforcement activity initiated by a securities regulator, such as the SEC in the United States, or equivalent bodies globally.
SEC
Jurisdiction ⎊ The Securities and Exchange Commission (SEC), within the context of cryptocurrency, options trading, and financial derivatives, primarily functions as the regulatory body responsible for enforcing federal securities laws.
SEC Enforcement Action
Action ⎊ An SEC Enforcement Action, within the context of cryptocurrency, options trading, and financial derivatives, represents a formal legal proceeding initiated by the Securities and Exchange Commission (SEC) alleging violations of securities laws.
Howey Test
Investment ⎊ Contract analysis hinges on demonstrating the presence of an investment of money in a common enterprise with an expectation of profits derived substantially from the efforts of others.
The Howey Test
Jurisdiction ⎊ The Howey Test, originating from the 1946 Supreme Court case SEC v.