- According to a new update to a bill amending California's securities-law, one of the biggest economies in the United States could be providing new clarity to crypto owners.
- The criteria that were cited is essentially what it says in the Howey Test.
According to a new update to a bill amending California's securities-law, one of the biggest economies is in the United States and the world's technological industry could be providing new clarity to cryptocurrency owners.
The criteria that were cited is essentially what it says in the Howey Test. For those that don’t know, this is the federal metric for assessing whether or not an asset is qualified as an investment contract. For digital assets, the Howey Test says the following:
“For purposes of the Securities Act, an investment contract (undefined by the Act) means a contract, transaction, or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party.”
The bill was initially introduced to update the securities law in February but these new updates target the role of cryptocurrency for the future. The federal securities and exchange commission has been one government body to have an impact on crypto and industry players. They have consistently objected to having a little basis to confirm whether a token is the security or not.
At the end of the day, the securities and exchange commission in the United States holds sway on a national scale. California is typically seen as a critical testing hub for new technological policies with cryptocurrency being a quick asset to hop above one the borders.