kaal:claim:5583610-021

The fourth Howey prong fails because LER accrual is automated by smart contract and driven by the shareholder's own decision to keep holding, leaving the issuer's role ministerial rather than entrepreneurial.

Source quote, verbatim

LER voucher rewards are driven by stockholders' efforts in maintaining stock ownership for a certain time period. LER accrual is automated via smart contracts and does not rely on LER's ecosystem, merchants, or issuers' managerial efforts.

From

Wulf A. Kaal, Liquid Equity Rewards in Corporate America (2025), 3.2. U.S. Securities Regulation, p. 13
https://ssrn.com/abstract=5583610 · source PDF

Cite as

Wulf A. Kaal, Liquid Equity Rewards in Corporate America (2025). SSRN: https://ssrn.com/abstract=5583610

Holds when

reward amounts are not subject to issuer discretion

Classification

mechanismsupport: arguedsmart-contractssecurities-law

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