SEC Clarifies Stance: 2Z Token Not a Security, Boosts Crypto Industry
The U.S. Securities and Exchange Commission (SEC) has clarified its stance on a specific type of crypto token, providing legal clarity for the crypto industry. The decision, concerning the 2Z token used within DEPIN networks, has been welcomed by industry players.
SEC Commissioner Hester Pierce, also known as 'Crypto Mom', has distinguished DEPIN's projects from traditional investment schemes. She views tokens like 2Z as working incentives for network participants, rather than securities.
The 2Z token facilitates access to unused private fiber optic lines controlled by network nodes. Participants receive 2Z rewards for their contribution. Notably, the SEC has ruled that 2Z tokens do not fall under current security registration criteria in the U.S.
This decision is seen as a precedent for crypto tokens with infrastructure functions, not capital attraction. It aligns with broader legal definitions for the crypto industry, including White House recommendations and the Project Crypto initiative.
Pierce has warned against applying traditional securities laws to all blockchain activities, as it could hinder technological development. Michael Siman, another SEC official, did not recommend coercive measures regarding the launch of the 2Z token.
The SEC's decision on the 2Z token has brought much-needed legal clarity to the crypto industry. It demonstrates a willingness to engage in dialogue with startups and regulators, as highlighted by Austin Federa, co-founder of doublezero. This precedent-setting ruling is expected to encourage further innovation and growth in the crypto sector.
