US SEC says Proof of Work Mining does not involve securities laws

PANews March 21 news, according to The Block, the U.S. Securities and Exchange Commission (SEC) clarified its stance on specific Proof of Work (PoW) mining activities, the agency's latest move after turning to a more friendly attitude towards the cryptocurrency industry. In a statement issued by the SEC company’s finance department on Thursday, SEC staff said Proof of Work mining does not involve the issuance and sale of securities; therefore, parties involved in mining activities do not need to register transactions with the committee under the Securities Act, nor do they fall within the scope of registration exemptions related to these mining activities in the Securities Act.

The SEC relied on the “Howie Test” in its conclusion Thursday—a case in the 1946 U.S. Supreme Court, which the SEC often cites to determine whether an asset meets the definition of an investment contract and thus belongs to a securities. The test relies on four questions: whether it involves investment in funds, whether it involves common businesses, whether it is expected to make profits, and whether the profit comes from efforts of others.