Some companies who conducted initial coin offerings (ICOs) might be eligible for ‘no action’ relief from the U.S. Securities and Exchange Commission (SEC), CoinDesk writes.
SEC Director of Corporation Finance William Hinman explains that it is possible for cryptocurrencies to stop resembling securities over time. Indeed, he accepted the hypothetical that if a token launched resembling a security, but three years later could show utility, it would be feasible to receive a no-action letter.
“Digital assets may evolve into an instrument that no longer needs to be regulated as such,” he said. In 2018, Hinman suggested Ethereum may have been deemed a security when it first launched but had since shifted away from such a resemblance.
Hinman now points to a company called TurnKey Jets, which obtained a no-action letter this year. According to Hinman, the company token, network and use-case have developed, meriting the letter. Hinman also suggested the company might have still secured no-action relief even if some features were still-in-the-works.
“If they needed more relief on the secondary market for that token, that would not be outside the realm of a possible no-action letter,” he said.