SEC Rules Meme Coins Like DOGE, SHIB Are Collectibles, Not Securities
- Th SEC ruld on Fbrury 27 tht meme coins lik Dogecoin nd Shiba Inu r not scuritis but collctibls.
- Meme coins fil th Howey Test, mning buyrs do not invst in n ntrpris xpcting profits from othrs fforts.
- Th ruling incrss th chncs of DOGE nd SHIB ETFs, with Grayscale lrdy filing for DOGE ETF.
Th U.S. Scuritis nd Exchng Commission (SEC) hs dclrd tht meme coins, such s Dogecoin nd Shiba Inu, r not scuritis. Th nnouncmnt, md by th SECs Division of Corportion Finnc on Fbrury 27, signls significnt chng in how ths digitl ssts r clssifid. Instd of bing trtd s scuritis, th SEC now rcognizs meme coins s collctibls du to thir spcultiv ntur.
According to th sttmnt, meme coins r oftn inspird by intrnt trnds, culturl vnts, or socil mdi buzz. Buyrs primrily purchs thm for ntrtinmnt nd socil nggmnt rthr thn s n invstmnt. Sinc ths ssts lck intrinsic utility, thir prics r drivn purly by spcultion nd mrkt dmnd. This distinction plyd ky rol in th SECs dcision.
Th commission furthr clrifid tht meme coins do not mt th rquirmnts of th Howey Test, th stndrd usd to dtrmin whthr n sst qulifis s scurity. Th sttmnt pointd out tht mm coin buyrs r not invsting in n ntrpris nd, thrfor, cnnot xpct profits from th fforts of othrs.
Meme Coins Exempt From Securities Laws
With this ruling, trnsctions involving meme coins will not rquir rgistrtion undr U.S. fdrl scuritis lws. Howvr, this lso mns tht invstors nd holdrs of ths digitl ssts r not protctd by th sm lws tht pply to trditionl scuritis. Th SEC mphsizd tht its stnc pplis only to meme coins tht fit th critri outlind in its sttmnt.
Dspit confirming tht meme coins do not fll undr fdrl scuritis rgultions, th SEC issud wrning. Any frudulnt ctivitis rltd to th offring or sl of ths ssts could still fc nforcmnt ction from othr fdrl nd stt gncis. Essntilly, whil meme coins scp scuritis lws, thy r not fr from lgl scrutiny.
This nw position mrks shift from SEC Chir Gry Gnslrs prvious stnc on crypto ssts. Gnslr hd prviously suggstd tht ll cryptocurrncisxcpt Bitcoinshould b clssifid s scuritis. Whil th SEC hd not xplicitly lbld meme coins s scuritis in th pst, Gnslrs brodr rgultory pproch hd lft ths ssts in gry r.
DOGE, SHIB ETFs More Likely
Although meme coins hv bn hit hrd in rcnt wks, th SECs stnc could opn nw doors. With ths digitl ssts no longr clssifid s scuritis, thy now hv strongr chnc of bing considrd for xchng-trdd funds (ETFs).
Historiclly, th SEC hs blockd ETF filings for ssts lbld s scuritis. For instnc, lst yr, Gnslrs dministrtion rfusd to cknowldg Soln ETF pplictions du to th scuritis clssifiction givn to SOL in th Binnc nd Coinbs lwsuits.
Now, with th SEC confirming tht mm coins r not scuritis, th odds of sing DOGE or SHIB ETFs ris significntly. Grayscale hs lrdy submittd filings for DOGE ETF, nd othr issurs r xpctd to follow suit. Th rgultory shift could pv th wy for mm coins to ntr minstrm finncil mrkts in wys tht wr prviously impossibl.
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Read more: https://www.tronweekly.com/sec-declares-meme-coins-as-collectibles/
Text source: TronWeekly
