In this guidance, US regulator the Securities and Exchange Commission provides a framework for analyzing whether a digital asset is an investment contract and whether offers and sales of a digital asset are securities transactions. Under the Howey test, which applies to any contract, scheme, or transaction, regardless of whether it has any of the characteristics of typical securities, an “investment contract” exists when there is the investment of money in a common enterprise with a reasonable expectation of profits to be derived from the efforts of others. Whether a particular digital asset at the time of its offer or sale satisfies the Howey test depends on the specific facts and circumstances.
