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Jun 9 β€’ 10 tweets β€’ 5 min read Twitter logo Read on Twitter

A beginner's guide to securities in the world of #crypto! πŸš€

πŸ”’ What is a #security?

In simple terms, a security is a type of financial asset or investment instrument.

It represents something of value that you can trade, like stocks or bonds. πŸ“ŠπŸ’°
πŸ”’ How is a #crypto determined to be a security?

Well, it depends on its characteristics and how it's offered to investors.

In the US, the Securities and Exchange Commission (SEC) uses the "Howey Test" to evaluate this. πŸ§ͺ
πŸ”’ The #Howey Test asks:

Does the investment involve putting money into a common enterprise with the expectation of profits primarily from the efforts of others?

If the answer is yes, it's likely considered a #security. πŸ“βœ…
πŸ”’ So, what does it mean for a crypto if it's classified as a security?

It brings a whole set of regulations and rules designed to protect investors. πŸ“œπŸ”’
πŸ”’ If a crypto is classified as a security, it may need to register with the #SEC, disclose information to investors, and comply with investor protection measures.

This ensures transparency and accountability. πŸ’ͺπŸ’Ό
πŸ”’ Keep in mind that regulations can vary in different countries, so it's essential to know the rules specific to your jurisdiction.

Consulting legal and financial professionals is always a good idea! πŸŒπŸ”
πŸ”’ Understanding the classification of a crypto as a security is crucial for both investors and projects in the crypto space.

It helps ensure a safe and regulated environment for everyone involved. πŸš€πŸ”’

#Crypto #Security #Investing #HoweyTest #Regulations
If you enjoyed this 🧡

Please give it a like and retweet to help other newbies to crypto.

Also don't forget to follow @theharristheory

Be sure to shout if there's anything else you'd like covered for future threads πŸ˜‰

#theharristheory #cryptoeducation #crypto #cryptotwitter

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More from @theharristheory

Jun 4
I've been seeing a lot on #BRC20
and #Bitcoin Ordinals and I'll be honest, I don't have a clue what these were. So I decided to change that.

Let's talk about it! 🧡

Understanding BRC-20 Tokens and Bitcoin Ordinals 🟠🟒

#crypto #cryptothread
BRC-20 tokens are a new experimental standard for creating and transferring tokens on the #Bitcoin blockchain. They work similarly to Ethereum's ERC-20 tokens but with some differences. However, it's important to note that BRC-20 tokens are still in the experimental stage.
BRC-20 tokens were made possible through the Ordinals protocol, which allows for the inscription of data on individual satoshis (the smallest unit of Bitcoin). This enables the creation of fungible tokens on the Bitcoin network. #Ordinals #Bitcoin
Read 16 tweets
May 6
Are you looking for the next $PEPE ??

If yes, then this post is for you and it's important you read this πŸ‘‡πŸ‘‡

Here's a 🧡:

In the #MemeCoinSeason it's easy to get caught up in the hype of a single project or coin.
#FOMO can be strong, and it can be tempting to go all in on a project that seems to be blowing up.

However, it's important to remember that investing is a long game, and chasing after the next big thing can often lead to disappointment and loss.
This is especially true when it comes to meme coins, like $PEPE, which has blown up but is now unpredictable.

One of the most important lessons to learn as an investor is to avoid putting all your eggs in one basket.
Read 10 tweets

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