US SEC Chairman Announces Token Classification Plan

Jinse Finance reported, citing The Block, that Paul Atkins, Chairman of the U.S. Securities and Exchange Commission (SEC), announced at the Federal Reserve Bank of Philadelphia's Fintech Conference plans to create a "token taxonomy" aimed at clearly distinguishing which cryptocurrencies qualify as securities. The initial classification includes: network tokens, NFTs, and digital utility tokens are not considered securities, while tokenized stocks and bonds are classified as securities. Atkins stated that this taxonomy will be based on the Howey Test (a 1946 U.S. Supreme Court case used to determine whether an asset is an investment contract). He pointed out that cryptocurrencies may be part of an investment contract, but this status is not permanent. As the network matures, code is released, control becomes decentralized, and the issuer's role diminishes, the nature of the token may change.