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Recent SEC Guidance On Memecoins Suggests Broader Policy Change

Author: Content Editor
Recent SEC Guidance On Memecoins Suggests Broader Policy Change
The recent guidance from the SEC's Division of Corporate Finance stating that memecoins are generally not sold as securities has broader implications for the digital asset industry. This marks a shift away from the SEC's previous attempts to regulate the entire industry and could impact all secondary-market transactions in digital assets, including on exchanges. The guidance confirms that purchasers of memecoins do not make an investment in a common enterprise and do not expect profits from the efforts of others, aligning with the requirements of the Howey test. This reversal in doctrine may be the reason behind the SEC's decision to dismiss several cases and stay further proceedings. While the guidance is not legally binding and could be potentially disregarded in the future, it will make it difficult for private plaintiffs to argue that most digital assets are sold as securities. Overall, the guidance represents a positive step in the right direction for crypto law and policy in the United States.

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