The SEC’s Division of Corporation Finance has indicated that crypto projects operating on functional networks can announce token buyback programs without necessarily making the kind of promise that could place their tokens within U.S. securities law. The position comes with a significant qualification: projects whose networks are not yet functional could face a different analysis if buybacks are promoted as a way for holders to earn yield or returns.
What the SEC staff said
In new frequently asked questions, the division said a buyback announcement on a functional crypto network does not, by itself, represent a promise of “essential managerial efforts.” That phrase is important under the Howey test, the legal standard used to determine whether an arrangement qualifies as an investment contract and therefore as a security.
The guidance also addresses other activities after a network becomes functional. Promises to maintain, upgrade or expand the system would not satisfy the relevant Howey element, according to the FAQs. Similarly, promoting a network’s existing uses—or making general aspirational statements that do not emphasize profits—would likely fall outside that part of the test.
The distinction is less favorable for projects that have not yet built a working network. In those cases, describing buybacks as a source of returns or yield for token holders could potentially raise securities-law issues.
Why the interpretation matters
A token buyback involves a project or related entity purchasing its own tokens, potentially reducing the amount available in the market or supporting demand. The SEC staff’s position concerns how such announcements may be viewed under one part of the Howey analysis; it does not establish that every token involved is outside securities regulation.
Attorney Gabriel Shapiro of MetaLeX Labs, who previously served as general counsel at Delphi Labs, described the position as going a long way. He also called the buyback treatment a “loophole,” arguing that projects could continue developing their networks and use buybacks to support token prices while obtaining some features associated with public investment without granting holders shareholder-style rights.
Shapiro cautioned that the FAQs are staff guidance and do not carry the force of law. A private plaintiff or a future SEC could take a different view, and a later commission could reverse the position.
Regulatory backdrop and market picture
The FAQs build on the SEC’s March interpretive release and its proposed Regulation Crypto Assets framework, which would allow projects to sell tokens without full registration. They also follow the agency’s innovation exemption for tokenized stocks, introduced after the Clarity Act failed in the Senate. SEC Chair Paul Atkins had indicated in July that the agency would act if the bill failed, while the CFTC issued a similar warning in August.
According to Decrypt, the crypto industry has increasingly looked to regulators for a path forward, although agency guidance can generally be unwound more easily than legislation.
Moneyiar market data, recorded on September 25, 2026, showed mixed performance among the listed assets. AKEDO (AKE) was trading at $0.0322406544, down 9.78% over 24 hours and 27.87% over seven days. ECOMI (OMI) stood at $0.0002317622, up 6.99% in 24 hours and 14.34% over seven days. FUNToken (FUN) was $0.0079030561, up 1.32% and 9.98%, respectively, while ONEchain (ONE) was $0.1452523174, down 4.60% over 24 hours but up 7.69% over seven days.
