Why LINK Avoids the SEC’s Net: Chainlink’s Token Utility Explained

Based on Chainlink's token utility model, the way it creates utility is by the LINK token being remunerated to node operators as reward for checking if price/data oracles are correct when obtaining price/data for something like weather forecasts and feeding it to wherever it needs to go. The Node Operators will also have to put up collateral before they validate the data to ensure integrity in the network's ecosystem amongst node operators ensuring good actors.

The main reason why Chainlink has not been pulled up by the SEC is because the actual Token (called LINK) is circulated full circle round the ecosystem by the push and pull of people owning the token and node operators having to be remunerated the token as they validate oracle data to be correct.

This creates the token utility to have a natural ecosystem whereby the demand of the token is always needed to sell the token back to the ecosystem so when node operators put in the work to validate data, they can receive LINK tokens in the form of remuneration.

This passes the SEC's Howey Test not being labeled as a security because, the utility token (as stated above) has a natural reason for the utility token to exist in the ecosystem AND node operators are not paid in money for their work but the LINK token itself.