[drcode]

Near as I can tell, the Howey precedent is for a type of asset so vastly different from a cryptocurrency such as bitcoin/ethereum that it is pretty much completely at the discretion of regulators as to whether they consider it to be a "security".

I know it would be nice to live in a world where judges can use an objective reading of the law/constitution to decide for certain in one way or another on such a fact, and that it would be nice to live in a world where lawyers like Preston could therefore make a reliable prediction from their expertise as to how courts will rule, but sadly in our world things don't work that way.

In an outlier situation like this, without strong precedents, regulators can make any decision they please and then create post-hoc rationales for defending their view.

(similarly, responses to this comment from either side will be easily able to make equally convincing absolutist arguments as to why bitcoin/ethereum are/aren't securities, given the vagueness in interpretation of precedents.)

[pjbyrne]

Well it's not the regulators who make the decision and set the precedents, it's the judges. Regulators are currently trying to figure out, to the extent existing precedents are inadequate, how to extend by analogy the existing precedents to the new circumstances in such a way as to convince a judge to extend the precedent. This is how a common law system is designed to work.

[comex]

Technically, under the (controversial) doctrine of Chevron deference, the regulatory agency’s view has significant weight, but they do still have to convince a judge that their interpretation is reasonable.

[drcode]

To be fair, It's totally reasonable that regulators/judges come come to the same conclusions that you make in your post, I just hold more cynical views as to how they arrive at those conclusions.