As ICONOMI first published their whitepaper they said they will pay dividends in form of ETH to their ICN hodlers, but at a certain point they realized that this will make ICNs a security so they switched to buyback method and Jani said that they will give ICN a utility on their DAMP platform (final product).
This means ICN isn't a security anymore it's a utility token now.
It's not up to us, or Iconomi, whether it's a security or not. Your reasoning is incorrect. ICN is still arguably a security.
The fact profits are being used to buy back the token doesn't prevent it from being classed as a security. It's still a method of profit distribution, and ICN holders are still expecting the value of their investment to increase.
It is better to stick with the "we don't really know yet" position, than to claim it definitely is or isn't a security at this stage.
As Bigsmoke is active with his moon talk and conjecture, close to an important date, you can probably expect most of his ICN to be sitting on Kraken right now, waiting to dump on your heads
