Ahead of the hearing in the case of the American company Ripple, which is scheduled to take place on January 15, 2025, a former attorney for the US Securities and Exchange Commission (SEC) has questioned the correctness of the previous court decision on the status of the cryptocurrency issued by the company, XRP. John Reed Stark believes that the decision, according to which XRP coins traded on the secondary market are not securities, could become a troubling precedent for other cryptocurrencies. Many coin issuers will cite this case, arguing that their tokens are not securities, the former SEC attorney said. The former official insists that the decision in the Ripple case should not remain ambiguous: the initial offering of coins to qualified investors and the subsequent trading of crypto assets must be registered as an offering of securities. Stark criticized the judge's argument that the lack of a direct connection between Ripple and retail investors reduces the need for their protection under securities law. He cited the example of stock investments, where investors may have legal protections even without a direct contractual obligation with the issuing company."The idea that retail investors in the secondary market don't need protection because they don't have a direct connection to Ripple is unfair. In traditional securities, these protections exist regardless of the investor-issuer relationship," Stark emphasized. The lawyer previously did not support the launch of spot exchange-traded funds (ETFs) tied to bitcoin in the US. Stark said that this could result in a "tragedy of epic proportions" for Wall Street. The former official also spoke out against blockchain technology - he is not sure that it makes it easier to track illegally obtained funds.
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