FTT: No Company, No Compliance, No Problem

A recent development from the SEC flew under the radar: the Division of Corporation Finance has issued guidance on how U.S. securities laws may apply to crypto assets. The recommendations call for token issuers to disclose extensive information - ranging from how their projects generate revenue, to technical details of the networks, to their ongoing involvement in the crypto ecosystem.

This guidance is directed at projects whose tokens could potentially qualify as "investment contracts." The language is cautious: “in cases where a digital asset is an investment contract…” or “if the asset falls under securities regulation…”

One token immediately comes to mind - FTT (FTX Token). The SEC has already classified FTT as a security. But since its issuer is bankrupt, there’s simply no one left to comply with the SEC’s guidance.

Still, I’m very curious to see how FTT trading will continue in light of the SEC’s current stance. After all, this is a highly unusual scenario: people are voluntarily buying a security (no one’s disputing it’s a security, right?) whose issuer went bankrupt long ago. That would be unimaginable in traditional finance - but crypto plays by its own rules. How financial regulators will navigate this is anyone’s guess.

It’s unfortunate that Binance users voted to delist the token. But FTT still trades on many other platforms!

And yes - FTT remains available on rabbit.io and will continue to be as long as there are active offers for its exchange on the market.