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The US Securities and Exchange Commission (SEC) has stated that it has never explicitly referred to tokens as securities. This follows from a footnote to the regulator’s lawsuit against the Binance exchange.

“As this court has noted and the SEC confirms, when the Commission uses the term ‘crypto asset securities,’ it does not mean the token itself, but the entire set of contracts, expectations, and understandings. […] The term is a shorthand,” the footnote says.

The documents also state that the regulator “regrets” any confusion that may have arisen in this regard and undertakes not to use it again.

Coinbase General Counsel Paul Grewal commented on the situation, pointing out that the SEC literally used the designation “digital security” in relation to XRP in the lawsuit against Ripple Labs.