The United States Securities and Exchange Commission (SEC) has claimed that FTX Token (FTT), FTX’s native digital currency, is classified as a security.
followdocument FTX’s management team sold FTTs as an investment contract early on. The company then used the proceeds from the token sale to fund the business, growth, and development of the exchange.
The SEC cites FTT whitepapers and information posted on FTX’s website, describing its contents as “The token that powers the FTX ecosystem”
The commission said the whitepaper outlined the profit potential of the token. while making investors expect revenue from the appreciation of the FTT’s value.
“FTT is positioned as an investment that will increase in value as it grows and expands in other ways. FTX has carefully designed incentive schemes for FTT and to reduce circulating supply.”
The US SEC also alleges that The promise of yield provides an incentive for investors to buy more tokens. In addition, clients who hold the asset for a long time will have lower FTX futures trading fees, and this is designed. came to increase the demand for FTT.
“If the demand for trading on the FTX platform increases, then the demand for FTT tokens may increase. Therefore, any price increase in FTT will benefit FTT holders equally and in direct proportion to their FTT holdings.”
The agency also accused Ellison, Alameda and Sam Bankman-Fried (SBF), founder and former CEO of FTX, of manipulating FTT prices to preserve value.
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