Hedera is seeking a firmer regulatory footing for HBAR, but that would not give holders a claim on network income. In a video examining the proposal, commentator Dana Love argues that the distinction helps explain why rising network activity has failed to support the token’s price.
Love cites a 168.4% monthly increase in Hedera transactions alongside HBAR’s decline from 10.47 cents at October’s opening to 7.99 cents roughly three weeks later. His central argument: clearer legal status could help trading and custody without materially changing how the token captures value.
The request goes beyond a commodity label
According to the video, Hedera joined Aptos Labs, Ava Labs, Stellar Development Foundation, Cardano Foundation and Chainlink Labs in an October 20 letter asking the SEC to put its digital-commodity definition into binding rule text.
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The distinction matters because the SEC’s March interpretation already named HBAR among its examples. Love quotes SEC Chairman Paul Atkins describing those examples as “illustrations,” rather than an immutable list.
The less-publicized request concerns trading: the signatories want secondary-market sales by parties other than issuers presumed not to involve investment contracts. That could reduce uncertainty for exchanges and custodians, although the video describes a request—not an adopted protection.
Love also flags a governance tension. Hedera has a council of member companies, while the SEC language he examines discusses operational, economic or voting control. He acknowledges the counterargument: the cited language does not make decentralization an absolute requirement, and the SEC named HBAR anyway.
More transactions do not guarantee stronger token demand
Hedera sets transaction fees in dollars and collects payment in HBAR. When HBAR rises, users need fewer tokens to pay the same fee: a structure that stabilizes business costs but weakens the direct connection between transaction growth and token demand.
Using the transfer fee cited in the video, one million transfers would generate about $100 in network fees. Holding HBAR alone does not entitle investors to a share of that revenue; staking rewards are a separate mechanism.
Love also cites Canary’s HBAR ETF reporting $106.5 million in paid-in capital against $46.1 million in net assets at June’s end. That gap should not be read as equivalent investor withdrawals, particularly given the token’s decline.
For investors, the proposed trading protections may matter more immediately than the label itself. Neither would change Hedera Hashgraph’s currently-running fee structure or establish a shareholder-like claim on its income.
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