Matt Levine, of Bloomberg, offers excellent insight about this . For some broader context, consider this on the SEC staff's issuance of a no-action letter to "Pocketful of Quarters" ("POQ"). In the POQ case, a company produced a token intended to be used in video games. The facts set out in the POQ no-action letter are distinguishable from those at issue in the Grams case in that (i) according to the letter, the video game technology was already "built" and (ii) there were strict limits on…

It is always a good thing for the regulators to avoid imposing two sets of regulations on the same activity. However, the limitation under the proposed exemption of selling only to a single Qualified Provider seems to create a needless conflict between the interests of the issuer and the municipal advisor. For example, what happens if the advisor can obtain better terms by selling to two clients, rather than to a single client? As a practical matter, the advisor will have to sell only to the…

For those hoping that cryptocurrencies may come into wider use, the IRS's affirmation of its existing guidance is bad news, even if expected. It means that the purchase of a cryptocurrency and the subsequent use of that cryptocurrency to purchase an asset constitutes a taxable event; i.e., that a positive change in the value of the cryptocurrency between the time of its purchase and the time of its use would be taxable. This tax treatment would not be problematic for a "stablecoin" linked to…

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