SEC "PoW mining is not a security"…Democratic Commissioner "No practical effect"

The U.S. Securities and Exchange Commission (SEC) recently stated that virtual asset (cryptocurrency) mining activities using the 'Proof of Work (PoW)' method are not subject to registration under securities laws. However, the only Democratic commissioner within the SEC countered this by saying it is a "statement with no practical effect."

According to blockchain-focused media outlet The Defiant on the 21st (local time), SEC Commissioner Caroline Crenshaw said, "This SEC statement specifies that miners do not need to register securities with the SEC," adding, "But the real meaning is that each mining method must be individually assessed to determine if it constitutes an investment contract."

In this announcement, the SEC stated, "Those participating in mining activities do not meet the transaction registration requirements under securities laws or fall under any exemption clauses."

Furthermore, Commissioner Crenshaw revealed that "the statement conceals the need to determine whether a specific mining method is an investment contract through the Howey Test." The Howey Test is a securities determination criterion centered on ▲investment of money ▲common enterprise ▲expectation of profits from the efforts of others.

Commissioner Crenshaw argued, "The SEC presupposes in this announcement that 'mining is not an activity expecting profits from the efforts of others,' but this is an assumption open to challenge," adding, "Starting from this assumption naturally leads to the conclusion that mining is not a security."

She continued, "This announcement only mentions the general PoW method and does not encompass all forms of mining," criticizing it as merely a generalized statement with no binding position.