Daniel Schoenberger, a top executive at Web3 Foundation, the development team behind Polkadot, has recently told the United States Securities and Exchange Commission (SEC) that the digital token DOT can no longer be classified as a security.
In a new blog post, Schoenberger informed the SEC that Polkadot (DOT) has morphed from security into software and can no longer be classified as an asset in the securities watchdog’s jurisdiction.
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Although DOT could be termed as a security at first, he said the team behind it has worked hard on its transformation.
Regarding the Polkadot development team’s experience with the regulatory agency, Schoenberger said the SEC was open and willing to communicate. He added that this has led to the creation of solutions to the issues the agency may have had with the transformation of DOT.
Daniel Schoenberger noted:
“Over the years, we have developed what we believe is a workable theory of how token morphing may be achieved for an increasingly decentralized project, like Polkadot, and a digital asset that, other than having been offered and sold initially for fundraising purposes, does not, itself, bear security-like characteristics…
“Consistent with the views that we have shared with the SEC staff, we are pleased to announce that DOT, the native digital asset of the Polkadot blockchain, has morphed. In our view, current day offers and sales of DOT are not securities transactions, and DOT is not a security. It is merely software…
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“Whatever it took in order for DOT, the native token of the Polkadot blockchain to be – or to become – a non-security, we were willing to do it. And so, we decided to try to take the SEC’s FinHub staff up on the offer to ‘come in and talk to us’…
“Our experience has been a positive one. The SEC has welcomed meetings with the Web3 Foundation, and there has been a spirit of open communication and dialogue. Those ongoing interactions have given us a deeper understanding of some of the SEC’s concerns and have helped us to develop solutions to address them.”
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