# kaal:claim:4021599-022

**Claim.** Under SEC guidance a token sold for use or consumption by purchasers may fall outside classification as a security, and the SEC lists characteristics whose stronger presence makes a token less likely to be considered a security.

**Type.** condition  **Support.** evidenced

**Holds when.**

- SEC framework for investment contract analysis of digital assets

**Source quote.**

> According to SEC guidance, if a token is sold for use or consumption by purchasers it may not be classified as a security for regulatory purposes. The SEC provided a list of characteristics where, the stronger their presence,35 the less likely a token is to be considered a security.

**From.** Wulf A. Kaal, *Securities Versus Utility Tokens* (2022), III. General Characteristics of Utility Tokens, page 11

**Cite as.** Wulf A. Kaal, Securities Versus Utility Tokens (2022). SSRN: https://ssrn.com/abstract=4021599

**Verify.** sha256 of source PDF `bb03790af46b3710e306121cfae25f850e3e7477e0f95313af42b9feeb6bc0c4` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202022%20-%20Securities%20Versus%20Utility%20Tokens.pdf

**Topics.** securities-law, systemic-risk, tokenomics

**Keywords.** sec-guidance, consumptive-use, securities-classification, utility-token

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