In the U.S. there remains uncertainty over the legal classification of cryptocurrencies, an issue that is currently being explored during multiple court cases.
The SEC often relies on the Howey Test, born from a 1946 U.S. Supreme Court case involving citrus groves, to help determine whether transactions are investment contracts and thus subject to securities laws. The Howey Test has been applied in numerous lawsuits brought by the SEC. One of the more prominent instancess was when the agency accused Ripple of illegally raising $1.3 billion through the sale of XRP. The agency too has cited the Howey Test in cases brought against crypto exchanges Coinbase and Binance.
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