Wednesday, August 10, 2022
Home Crypto News Market SEC v. Ripple: Another Document Proves XRP Is Not a Security

SEC v. Ripple: Another Document Proves XRP Is Not a Security

- Advertisement -
Follow-Us-On-Google-News

SEC v. Ripple: Another Document Proves XRP Is Not a Security.


 

Since there is no regulatory clarity from the United States Securities and Exchange Commission, the issue of what cryptocurrency constitutes security has been a major topic of discussion. 

Several cryptocurrency and legal experts have weighed in to the debate to get a perfect understanding of the topic, which could help the crypto industry thrive in the United States. 

Following a lawsuit slammed by the U.S. SEC over fintech firm Ripple, the debate about what should be considered security has heightened. 

Legal Advice to SEC

Perkins Coie, an international law firm, sent a 49-page document to Williams Hinman on March 26, 2018, in a bid to provide legal advice on the classification of cryptocurrencies. 

Excerpts of the letter read: “a token by itself is never an investment contract […] The investment contract arises from the understanding as to how the token will be developed into something of useful value.” 

The letter, which serves as legal advice to the securities agency, was written three months before Hinman’s 2018 speech, where he declared that Bitcoin and Ethereum are non-security. 

Hinman also indicated that Ripple (XRP) is not a security, a comment that was backed by former SEC chairman Jay Clayton in his letter to Congressman Ted Budd in 2019. 

SEC Thinks Otherwise 

However, despite these supporting facts that could have laid to rest the argument as to whether XRP is a security, the SEC has continued to maintain that the cryptocurrency falls under its jurisdiction. 

According to the SEC, both Hinman’s 2018 speech and Clayton’s letter to Congressman Budd are merely personal opinions and do not represent the views of the entire agency. 

XRP Functions as a Currency

Ripple’s XRP has functioned as a currency, as it is mostly used in cross-border settlements via its technology, the RippleNET. 

The use of XRP in cross-border settlements has resulted in several countries declaring cryptocurrency as a non-security. 

Canada, the United Kingdom, Switzerland, and the United Arab Emirate (UAE) are in the list of countries that do not consider XRP to be a security. 

While there is no clear regulation that would easily aid the classification of cryptocurrencies in the United States, the SEC has still maintained that XRP is a security. 

However, with President Joe Biden signing the cryptocurrency executive order earlier this month, it is expected that a clearer rule for the nascent industry will be established. 

- Advertisement -

Disclaimer

The content is for informational purposes only and may include the author’s personal opinion, and does not necessarily reflect the opinion of TheCryptoBasic. All Financial investments, including crypto, carry significant risk, so always do your complete research before investing. Never invest money you cannot afford to lose; the author or the publication does not hold any responsibility for your financial loss or gains.

Albert
Albert Brownhttps://thecryptobasic.com/
Albert Brown is a cryptocurrency investor and journalist who has been in the nascent space since 2017. His love and passion for technological innovations made him delve deeper into the world of blockchain and cryptocurrencies. As a journalist, Brown has written on several crypto-related topics that have been referenced by popular industry players like Tyler Winklevoss, Binance CZ, etc.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -

Recent News & Articles

Metaverse Memecoin Tamadoge Raises $1 Million Midway Through Its Beta Sale

London, UK, 10th August, 2022, ChainwireTamadoge, the P2E metaverse meme coin, has raised $1 million after just 12 days of its beta sale. The...

Vitalik Buterin, Justin Sun, Binance, FTX Join 440 Addresses Receiving 0.1 Ethereum From Sanctioned Tornado Cash

  Binance and FTX Join the 440 Addresses That Received 0.1 ETH From Sanctioned Tornado Cash. window.coinzilla_display =...

Nigerians Can Now Pay Their Utility Bills With Bitcoin

  Cryptocurrency is now accepted for utility payments in Nigeria. window.coinzilla_display = window.coinzilla_display || ; ...

GALA, The World-Leading Web3 Company, Spearheads A New ERA Of Entertainment With GALA FILM

Jackson, USA, 9th August 2022, Chainwire Announce Partnership With Stick Figure Productions to Distribute Four Down Executive Produced by Dwayne Johnson and More. Gala, one of...

XRP Shuffling Continues, 375 Million XRP Moved Around Ripple, Exchanges, and Unknown Wallets 

  Whale Alert continues to keep tabs on these large XRP movements. window.coinzilla_display = window.coinzilla_display || ; ...

Ethereum Proof-of-Work Fork (ETHPOW) Driven By Miners To Abolish EIP-1559

  EIP-1559 will be abolished in the Ethereum proof-of-work (PoW) fork. window.coinzilla_display = window.coinzilla_display || ; ...

CryptoCom CEO: Crypto Industry Will Comeback Very Strongly

Crypto Industry Will Come Back Very Strongly, says the world's top exchange CEO. window.coinzilla_display = window.coinzilla_display ||...

Subscribe To Our Newsletter

Get Updated with All The latest Crypto News, Articles, Reviews, Analysis and much more. Delivered Every Monday.