Whether a company decides to issue a utility token or a security token really depends on the business model they are looking to achieve and how they intend to tie in to regulations in the states they will be operating in.

At one point in time you could get away with an ICO that would pay out dividends (clearly a security) and there wouldnt be too much fuss because the ICO phenomenon wasnt big enough. But now with the crackdown of global regulators on securities and making sure that any company selling securities complies with local securities regulations genuine consideration should go into whether or not you business model can support a utility token.

Some organisations, Paypie for example went the route of a utility token, and are now having to actively work with their local (Canadian) regulators in order to show that it is a utility token and therefore exempt from security regulation. In order to do this they are essentially needing to complete their platform and show the use case of the token. The whole concept revolves around how their token will be engaged in the platform.

Another example would be Caviar, they have decided to release a token that will pay out dividends based on performance of the organisation. As such they dont need to focus on a use case of the token as it is only there for passive income. They do however have to put further consideration into the markets they are going to be allowed to sell their tokens to (they were pinged by a US state regulatory office for having sold a security to a US citizen). They are now having to complete a full KYC audit in order to ensure that no tokens were sold to persons in states which the sale would not be legal. Every country has a different regulatory framework for securities and the level of regulation of/interference with the market is different, therefore there can be a lot of work to protect your business from attracting unwanted attention from regulators.

As noted to a degree above why does there need to be a defined 'good', 'right' point of market dominance for Bitcoin. That is something for the market to determine and plays both off what other coins have to offer and what bitcoin has to offer. Bitcoin is still has the biggest share as it is the household name, with a strong support, following and direction, but that doesnt mean it needs to hold 50% of the market. It can do its thing at any % (though I guess it may lose some of its shiny appeal if it is 2nd on CMC).

Think about where Ethereum was in January last year. I'm sure most people didn't see the huge potential and the massive crypto explosion (token-wise) that would be caused as a result of the eth network. So at the start of last year there was a bigger market dominance by bitcoin because the other players in the game were weaker, but that dint stop eth from executing its plan and becoming a star player that has earned its slice of the market.

When I got into Bitcoin it was the easiest thing to buy with $$ and therefore was required in order to purchase eth or other coins, some of which may or may not be shit (im sure future me will give me a lecture in time). This added to its utility and thus gave it a bump in market dominance. If you go on any major exchange you can now pick up around 5-10 crypto assets which has eroded the 'gateway' effect that bitcoin had.

I don't think there is a perfect, right or good market slice for bitcoin to hold on to (nor do I see a need for there to be one), but I see it being the big boy on the block for some time.

There are securities laws in the United States that would prevent the sale of an unregulated/unexempted security from being sold to someone in the states. The issue for the state or federal regulator would be getting the entity to appear in their jurisdiction, as its quite easy to just ignore them if you do not operate or have a place of business there. Caviar.io is a recent example of a company that got pinged, even though they had anti-us measures in place they still sold to a US person and got in trouble for it. The principal operated out of a US state and so they were able to slap his wrist easily. Now they are having to do a full scale KYC audit to show the regulator in which ever state the principal operates out of that they are willing to play ball.

I think KYC and AML precautions show a capable and risk averse team which in my opinion is a good thing. If they are willing to play ball with global authorities and have done their research about how to conduct themselves then that shows at least they care.

On the utility token point there are a number of concerns with proving that the token has actual utility and isnt just a non-dividend bearing security. My understanding is that Paypie is having to wait until their platform is 100% operational in order to show the Canadian authorities that their token has genuine utility and should be exempt from securities regulations. Voting rights on platforms, staking rights on platforms & proper use cases are what your after. Simply swapping a token for something that money could buy can mean that the 'utility' of the token is questionable (ie you can buy stuff from X using x token isnt really utility because why cant you do that with $).