The US Securities and Exchange Commission said Friday that token buybacks, network upgrades and marketing claims do not automatically turn a crypto asset into a security, according to The Block. In an updated Frequently Asked Questions release, the Division of Corporation Finance said announcing a buyback program for an already-functioning crypto network would not, by itself, make the associated token subject to an investment contract — though that would not necessarily hold for a network that is not yet functional where issuers pitch the buyback as a source of returns for holders.

The FAQ also addressed projects that keep developing after launch. "Once a crypto system is functional, services to secure, maintain, improve, or enhance such a system or its functionality, or to facilitate network effects" would not count as the kind of managerial effort under the Howey test, it stated. Marketing a network's existing uses generally would not create an expectation of profit either, nor would statements about future features, so long as they don't promote the potential for profit, though the answer still depends heavily on each case's specifics. The update builds on the SEC's March "Interpretive Release" on how securities laws apply to crypto, and comes weeks after the Clarity Act failed to advance in the Senate, leaving regulators to work under existing laws.

Separately, the CFTC updated its own crypto FAQ on Thursday, saying futures firms and clearinghouses may invest customer funds in tokenized versions of previously permitted assets as long as they meet investment and custody requirements. CFTC staff also said regulated firms can use blockchains for recordkeeping but must be able to produce the records even if a blockchain or its block explorer is not functioning.