SEC Staff: Token Buybacks and Continued Development of Functional Crypto Networks May Not Trigger Howey Test The SEC’s Division of Corporation Finance issued new FAQs clarifying its March 17 crypto guidance. Staff said Staking Receipt Tokens may qualify as “digital tools” or “digital commodities,” depending on their structure. For already functional crypto systems, continued maintenance, improvements, network development and non-security token buybacks generally do not constitute “essential managerial efforts” under the Howey test. However, buybacks promoted as generating returns before a system becomes functional may constitute such efforts. The FAQs represent staff views and have no legal force or effect.