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In an informal statement made at Yahoo Finance’s All Market Summit: Crypto, William Hinman, the United States Securities and Exchange Commission (SEC)’s director of corporate finance, indicated that the regulatory agency has no plans to deem ether a security.

“… based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions,” Hinman said in a speech at the summit.

Along with ether, Hinman stated that the SEC would not classify bitcoin as a security, either. Rather, both cryptocurrencies function similar to commodities like gold, silver or oil, the agency believes.

But not all coins are created equal, Hinman expressed in his speech, and the SEC’s leniency on crypto’s top assets won’t relieve tokens from scrutiny. Tokens and Initial Coin Offerings, he continued, are most likely to be considered securities. The distinction lies in how the asset is offered or sold to the public.

“… strictly speaking, the token — or coin or whatever the digital information packet is called — all by itself is not a security … But the way it is sold — as part of an investment; to non-users; by promoters to develop the enterprise — can be, and, in that context, most often is, a security — because it evidences an investment contract,” Hinman stated.

This analysis seems to prioritize circumstance over semantics when deeming a token’s securities status. Projects will often dance around their token’s nomenclature to avoid self-branding as something that could be seen as a security, but Hinman conveyed that the SEC isn’t fooled by the verbal footwork. He made it clear in his speech that “simply labeling a digital asset a ‘utility token’ does not turn the asset into something that is not a security … the economic substance of the transaction always determines the legal analysis, not the labels.”

Hinman appeared to contradict himself when he dove into an analysis of token sales likely falling under the blanket of securities, only to dismiss

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