> For the complete documentation index, see [llms.txt](https://gitbookwhitepaper.gitbook.io/gnc-whitepaper/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://gitbookwhitepaper.gitbook.io/gnc-whitepaper/ico/legal.md).

# Legal

In July, the Securities and Exchange Commission issued a ruling that some of the “coins” offered during recent ICOs are actually securities, and thereby are subject to the agency’s regulations. By offering dividends and profit-sharing such companies failed the Howey Test, created by the US Supreme Court for determining whether certain transactions qualify as “investment contracts.”

**The Howey test consists of the following:**

* Is it an investment of money or assets?
* Is the investment of money or assets in a common enterprise?
* Is there an expectation of profits from the investment?
* Does any profit come from the efforts of a promoter or third party?

Unlike other tokens , GNC is a utility token and its purpose is to facilitate services (copy- trading ) on the GERINO platform . GNC is not backed by real assets (such as real estate) and doesn’t grant their holders any dividends. As Tim Draper mentioned in his open letter: “If the purpose of a token is for societal transformation, and all proceeds go to the support and development of the token, it need not register.”