SEC calls FTX platform token FTT a security

FTX’s trading token, FTT, is sold as an investment contract and is a “security,” the U.S. Securities and Exchange Commission (SEC) said in a lawsuit filed against the former Alameda CEO and FTX Linkage. In its complaint, the SEC stated that “if demand for transactions on the FTX platform increases, demand for FTT tokens may increase, so that any price increase in FTT benefits FTT holders equally and in direct proportion to their FTT holdings. FTT’s buy-and-burn program is similar to a stock buyback, with proceeds from FTX being used to buy back and burn FTT, thereby increasing its value.”