Falling cryptocurrencies (bitcoins, dogecoins, shiba coins, binance coins and other) Credit: Igor Faun/Shutterstock.com The Next Big Case in the Crypto Wars
In his Corporate Securities column, Professor John Coffee discusses how in two SDNY decisions, each decided in July 2023, two respected judges have disagreed as to whether certain cryptocurrency instruments amount to securities.
September 20, 2023 at 12:00 PM
9 minute read
Over the multiple decades (too many to count) that I have taught Securities Regulation, the most stable, unchanging part of the course was the chapter on "What Is a Security." All law professors teach SEC v. Howey, 328 U.S. 293 (1946) and its three-part test: Was there (1) an investment of money or property (2) in a common enterprise (3) with an expectation of profits predominantly from the efforts of a promoter or other third party?
To be sure, there were a few other issues: horizontal versus vertical commonality, debt versus equity (Reves v. Ernst & Young, 494 U.S. 56 (1990)), and unique investments sold to a single person and not designed for trading (Marine Bank v. Weaver, 4555 U.S. 551 (1982)), but basically this was the easiest part of the course to teach.
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