SEC Updates Crypto FAQ on Token Buybacks and Managerial Efforts

The SEC's Division of Corporation Finance updated its crypto FAQ, clarifying that token buybacks for functional networks do not constitute a commitment to "essential managerial efforts." The SEC stated that maintaining, upgrading, or expanding a functional network, or making general statements about its features, does not meet the Howey test criteria. However, if a network is not yet functional, promoting buybacks as a source of profit for holders may still trigger securities law application.