I hate putting my legal hat on Twitter - mostly because I use this page to bs - but I have to in order to shut this down.

Chainlink $Link does not fit within the Howey framework.

The Howey test refers to the Supreme Court decision in SEC v. W.J. Howey Co. https://twitter.com/nsquaredcrypto/status/1341754538345308161

2/ The "Howey Test" determines whether certain transactions qualify as "investment contracts." If so, then under the Securities Act of 1933 and the Securities Exchange Act of 1934, those transactions are considered securities and therefore subject to certain disclosure and . . .

3/ registration requirements. Under the Howey Test, a transaction is an investment contract if:

1) It is an investment of money
2) There is an expectation of profits from the investment
3) The investment of money is in a common enterprise
4) Any profit comes from the efforts

4/ of a promoter or third party. I don't disagree that an investment in Chainlink (OR ANY OTHER CRYPTOCURRENCY) meets the first two parts of the test. Most courts focus on 3 & 4. The term "common enterprise" isn't precisely defined, and courts have used different interpretations.

5/ Most courts define a common enterprise as one that is horizontal, meaning that investors pool their money or assets together to invest in a project. The final factor concerns whether any profit that comes from the investment is largely or wholly outside of the investor's

6/ control. If so, then the investment might be a security. If, however, the investor's own actions largely dictate whether an investment will be profitable, then that investment is probably not a security.

7/ Chainlink is extremely unlikely to satisfy the Howey requirements. Like Ethereum, Chainlink is highly decentralized, as such, it should not be deemed a security because an owner of $LInk is not relying on the efforts of the founders of Chainlink/Smart Contract to experience a

8/ profit from their purchase of $Link. In short, the more decentralized, the higher chances that it is not a security. The SEC has already made it know that Ether is likely not a security. Like Eth, Link is highly decentralized. Chainlink is a decentralized oracle network built

9/ on Ethereum designed to connect off-chain data sources to on-chain smart contracts. LINK serves as the utility token, rather than as a security token, for the Chainlink network which acts as a trust-minimized middleware solution to the oracle problem.

10/ In sum, decentralized cryptocurrencies typically fail the Howey test. Because the Chainlink node network is highly decentralized, it can’t be said that the purchaser is relying upon the efforts of others. As such, Chainlink is free from SEC regulation.