You heard about Howey test used in the USA?
"a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party,"
1946 Supreme Court case: SEC v. W.J. Howey Co., FL.
I don't know enough about LEO. The little I know about PAL leads me to believe it might not match the Howey test.
- Tokens may be bought - but much of the original issue was not. (unclear, maybe yes)
- The Enterprise is common (imo no, you post for yourself, curate for yourself)
- Profit solely from the efforts of others (no, you post for yourself, curate for yourself)
Additionally, you can argue PAL's a utility token; Can be spent for upvotes (utility) or staked to improve curation earnings. One wrinkle is that inflation granted to stakers might represent a profit from the effort of others.
No doubt PAL is an asset of a kind, and PAL earned (e.g. curation) is income of a sort.
Depending on where on lives, this is probably taxable. Doesn't make it a security though.
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I've never heard about that case @eturnerx. Thx for pointing me in that direction.