All about PUMP’s 18% surge after SEC’s clarification, 398M token buybacks

In a major boost for tokens with protocol revenue and buybacks, SEC staff has now clarified when live tokens, buybacks, and staking receipts are not securities.

SEC securities clarification sparks market optimism

The SEC clarified that it uses the classic Howey test to determine when crypto assets and token sales constitute securities under federal law. The agency posited that the classification mostly focuses on economic reality, rather than terminology.

As such , digital assets fall under securities regulation if investors anticipate profits driven by managerial effort of founders. 

At the same time, the SEC also noted that buybacks do not make a commodity into a security and same with liquid staking. 

How did PUMP’s market react?

Thanks to the SEC’s clarification, PUMP recorded a major upswing. The altcoin rebounded from its $0.0038 slip, reclaimed and flipped $0.004, and rallied to daily high of $0.0046.

At the time of writing, PUMP was trading at around $0.0045, up 18% on the daily charts. The price hike was followed by a 57% surge in spot trading volume. 

A look at capital flows

With investors incentivized by recent positive developments, PUMP’s network saw fresh capital flows.

According to DefiLlama, the protocol’s USD Inflows rose to $24 million. This marked a notable reversal after dropping for four consecutive days and hitting the negative zone just over 24 hours ago.