On April 3, 2019, the Strategic Hub for Innovation and Financial
Technology (“FinHub”) of the U.S. Securities and
Exchange Commission (“SEC”) published two pieces of
guidance on when a blockchain-enabled digital asset will, or will
not, be considered a security.
The first piece of guidance (the “TKJ No-Action
Letter”) was a no-action letter1
issued by the SEC’s Division of Corporation Finance in
response to a request2 from TurnKey Jet, Inc.
(“TKJ”), a Florida-based air carrier and air taxi
operator. The TKJ No-Action Letter represents the first time that
the SEC staff has indicated that it would not recommend enforcement
action to the SEC if, in reliance on counsel’s opinion that
the digital assets are not securities, the subject entity offers
and sells securities without registration under the Securities Act
of 1933, as amended (the “Securities Act”) and the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”).
