The SEC has dropped its claims against Nova Labs, creator of the crypto project Helium

This also means that the Helium WiFi Hotspots are not considered securities. Helium can now continue developing WiFi infrastructure and providing crypto incentives

The Securities and Exchange Commission (SEC) has dropped its claims against Nova Labs, creator of the crypto project Helium, arguing that their tokens, including HNT, MOBILE, and IOT, are not considered securities. This also means that the Helium WiFi Hotspots are not subject to securities law.

Helium can now continue building out its WiFi infrastructure and providing crypto incentives without having to worry about the SEC subjecting it to never-ending legal suits. The Helium team remains excited by their vision of creating a fully connected world with the help of blockchain technology.

Former SEC chair Gary Gensler made one final lashing out, targeting Helium with an enforcement action.

However, Helium announced on its blog that the case was "unfairly dismissed," meaning the SEC cannot pursue similar cases against Helium in the future. Helium also announced that its tokens, including its WiFi tokens, can now be declared saints.

Helium operates a blockchain network responsible for around 375,000 WiFi Hotspots, aiming to decentralize the WiFi business. Its market cap was around $5 billion in 2021 and has since dropped to $480 million. Since Trump’s inauguration, the SEC has dropped several high-profile cases, including those against Ripple, Coinbase, and Uniswap.

“Today marks a major win for Helium and The People’s Network,” wrote Helium on their blog. “Nova Labs, the founding team behind Helium, confirms the SEC has agreed to dismiss with prejudice its claims that Nova Labs sold unregistered securities. With this dismissal, we can now definitively say that all compatible Helium Hotspots and the distribution of HNT, IOT, and MOBILE tokens through the Helium Network are not securities”.

The SEC, however, will still fine Nova Labs with a $200,000 penalty related to their civil case involving major firms, including Nestle, Lime, and Salesforce. The SEC claimed that they engaged in fundraising misconduct by making inflated claims about their relation to major firms, during a 2021-2022 token sale. The SEC argues that they inflated their valuation to $1 billion by luring investors under false pretenses. Despite Helium only having limited contact with companies like Nestle, they presented these companies as partners and users of their technology.

The $200k settlement allows Helium to move on without admitting guilt. Crypto projects, moreover, should learn a lesson from the incident, remembering the dangers of marketing a fundraising campaign.

“With the dismissal of the SEC’s unregistered securities claims with prejudice,” Helium wrote on their blog, “the outcome establishes that selling hardware and distributing tokens for network growth does not automatically make them securities in the eyes of the SEC”.