The Chamber of Digital Commerce (Chamber) and The Blockchain Association (Association), two not-for-profit organizations that promote blockchain-based technologies, recently filed amici curiae briefs in SEC v. Telegram Group Inc., 19-9439 (SDNY). The two organizations took starkly different approaches; however, they both request that the court distinguish between the transaction that is the investment contract and the subject of the investment contract. Both amici aver that in the blockchain context, the digital assets are improperly conflated with the investment contract; that is, when digital assets are simply the subject of an investment contract, such as the orange groves in SEC v. W. J. Howey Co., 328 U.S. 293 (1946), those are not the investment contract.

The Chamber's brief does not take a position on the application of the securities laws to Telegram but instead focuses on the overall regulatory scheme of digital assets and urges the court to undertake a two-part analysis ("whether there is an investment contract, offered in a securities transaction" and "whether the subject of an investment contract is a commodity that can be sold in an ordinary commercial transaction"). In stark contrast, the Association's brief posits that Telegram did not violate the securities laws. The Association's brief warns the court of far-reaching repercussions of a broad decision in light of what it characterizes as the SEC's unclear regulatory guidance, regulation by enforcement, closed-door consultations and no-action letters addressing "tokens [that] were so clearly not securities that it seemed bizarre that the SEC would even undertake the analysis." While the two briefs are very different, they appear to promote similar substantive securities law arguments as to the proper investment contract analysis application to digital assets.

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