Investment contracts are securities regulated by the SEC, so if a crypto transaction qualifies, it falls under the agency’s jurisdiction and must be properly registered under the law. The regulator has argued to lawmakers and courts that the majority of digital assets are securities, but Coinbase and others in the industry have argued that once an asset hits the secondary market and is no longer connected to the business that issued it, the token is beyond the SEC’s legal reach. Answering this controversy will be fundamental to the US crypto sector.