U.S. judges clarify that crypto tokens are not inherently securities under current laws.
Recent rulings stress that context matters in classifying cryptocurrency tokens as securities.
Judges reject SEC’s argument that crypto tokens themselves embody investment contracts.
U.S. judges are providing clarity on the legal status of cryptocurrency tokens. In a series of recent rulings, judges have emphasized that tokens themselves are not inherently securities. These decisions come from cases involving Ripple, Kraken, and Binance, where the SEC sought to categorize these tokens as securities under existing laws.
Judge Torres in SEC v Ripple told the SEC that the XRP token itself is not a security /1 pic.twitter.com/XpjbaJbdsl
— bill morgan (@Belisarius2020) August 29, 2024
In the SEC v. Ripple case, Judge Torres explicitly stated that XRP, Ripple’s digital token, is not inherently a security. This ruling addressed the SEC’s argument that XRP, by its nature, should be classified as a security. Judge Torres asserted that XRP does not meet the criteria of an investment contract as defined by the Howey Test. This decision underscores the need to distinguish betwe…
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