Ron Geffner, a notable figure in the security industry, recently shared his insights on the XRP ruling and its potential ramifications for the cryptocurrency sector. During his appearance on The Todd Ault Podcast, he delved into the intricacies of the Howey Test, a four-pronged evaluation used to determine the classification of an asset as a security. Geffner emphasized that assets used on digital exchanges or as compensation for employees and consultants were less likely to be categorized as securities.
Also Read : Ripple News: The Most Traded Altcoin: XRP Outpaces Competitors by 4x, Reveals Kaiko Data
Geffner acknowledged the challenges associated with applying the Howey Test to the cryptocurrency space, noting that it often led to confusion. He highlighted that the crypto community frequently argued that traditional securities laws might not be suitable for digital assets, given their representation of a novel technological paradigm.
Regarding the recent ruling, he expressed, “The situation is, at best, perplexing. The SEC has initiated legal actions against Coinbase and Binance. The outcome may, to some extent (and though I’m not currently a litigator, having started my career at the SEC), hinge on whether the courts handling these other cases align with the recent court ruling, which partially favored Ripple and challenged the SEC’s stance. I had hoped that Congress might step in to provide clarity and reconsider the regulations rather than leaving it solely in the SEC’s jurisdiction.”
In a recent development, a federal judge in New York issued a ruling that partially favored Ripple in its case against the SEC. The judge determined that some sales of XRP, a cryptocurrency issued by Ripple, did not qualify as securities, while others did. This outcome represents a victory for Ripple and poses a challenge to the SEC’s perspective on token sales. Notably, XRP’s price experienced an increase following the ruling. However, it’s worth noting that the SEC has filed an appeal against this ruling.
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