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Fazzyfocus

SEC commissioner Hestor Pierce on DA's

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33 minutes ago, Fazzyfocus said:

It may be worth you reading the statement in full. there is a lot more context in there. e.g:

"Yet many of these projects begin in a centralized manner that looks about the same as any other start-up. A group of people get together to build something and they need to find investors to fund their efforts so they sell securities, sometimes called tokens. The SEC applies existing securities laws to these securities offerings, which means that they must be conducted in accordance with the securities laws or under an exemption. When the tokens are not being sold as investment contracts, however, they are not securities at all. Tokens sold for use in a functioning network, rather than as investment contracts, fall outside the definition of securities"

That to me SCREAMS of Ripple sales to FI's for the purposes of creating liquidity in a functioning network. 

I agree it is about building the network which is very similar to your btc or your eth. As long as those sales to FIs aren’t investment contracts then we should be good 

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7 hours ago, Fazzyfocus said:

"Yet many of these projects begin in a centralized manner that looks about the same as any other start-up. A group of people get together to build something and they need to find investors to fund their efforts so they sell securities, sometimes called tokens. The SEC applies existing securities laws to these securities offerings, which means that they must be conducted in accordance with the securities laws or under an exemption. When the tokens are not being sold as investment contracts, however, they are not securities at all. Tokens sold for use in a functioning network, rather than as investment contracts, fall outside the definition of securities"

That to me SCREAMS of Ripple sales to FI's for the purposes of creating liquidity in a functioning network. 

and here is an open invitation to Ripple to clear up the regulatory uncertainty once and for all

Quote

 

.......Director Hinman went on to explain, however, that because the token “all by itself is not a security, just as the orange groves in Howey were not,” a token sold in a securities offering might later be sold in a transaction that does not constitute a securities offering.[14] Once “a network becomes truly decentralized, the ability to identify an issuer or promoter to make the requisite disclosure becomes less meaningful” and offers and sales of tokens are no longer subject to the securities laws.[15]

Director Hinman’s speech has provided a useful framework within which people can analyze their token offerings in connection with the securities laws. The staff is working on some supplemental guidance to help people think through whether their crypto-fundraising efforts fall under the securities laws. There is also a standing offer for people to come in for so-called no-action relief in connection with a particular token or project. The applicant for no-action relief lays out the parameters of what it is trying to do, and the SEC staff can respond by saying that it would not recommend an enforcement action to the Commission based on the parameters set forth in the request for relief.

 

I presume this could be done in a matter of weeks without the need to wait for new legislation

 

Edited by Julian_Williams

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33 minutes ago, Julian_Williams said:

and here is an open invitation to Ripple to clear up the regulatory uncertainty once and for all

I presume this could be done in a matter of weeks without the need to weait for new legislation

 

Possibly I guess. Personally? I would prefer it getting nailed by summary judgement in court leaving absolutely no room for confusion in the future. 

Nail the matter. Close it once and for all and shut the door on even the thought of a future lawsuit being a consideration down this specific path for any one. 

 

Case closed. Literally. 

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2 hours ago, Fazzyfocus said:

Possibly I guess. Personally? I would prefer it getting nailed by summary judgement in court leaving absolutely no room for confusion in the future. 

Nail the matter. Close it once and for all and shut the door on even the thought of a future lawsuit being a consideration down this specific path for any one. 

 

Case closed. Literally. 

He is clearly closing the door on making hard and fast rules at this early stage - he tells us such clarity is years away

Quote

"Enforcement actions are not my preferred method for setting expectations for people trying to figure out how to raise money. For this reason, it is important for the Commission, in conjunction with Congress and its fellow regulators, to offer something more concrete and carefully considered.......Ambiguity is not all bad, of course. We might be able to draw clearer lines once we see more blockchain projects mature. Delay in drawing clear lines may actually allow more freedom for the technology to come into its own.[22]"

he then goes on to explain the nuanced approach that would be needed

and returns to his preferred method of regulation in the interim period

Quote

" Our interactions with cryptocurrencies are not limited to questions about the regulation of token sales and disclosures. Closely linked to the question of whether tokens are securities is the question of how the platforms on which tokens trade should be regulated. Some of these platforms want to register with us, and I am eager to make progress on this front. There are features of crypto trading platforms that may differ from exchanges or alternative trading systems designed for traditional securities. To identify how regulation may need to change to accommodate these differences we will need to improve our understanding of how the platforms operate.

and he ends with the same: 

Quote

That careful thinking, however, may mean frustration for the innovators hoping for quick answers about what the relevant regulations are. Channel that frustration by coming and talking to us about how you think we should approach these regulatory questions.[32] Sometimes I feel like the repairman in the ATM sending slips of paper to the outside world asking for help. In my case, I am asking for help on getting the regulations right so that innovators and entrepreneurs can spend their time and attention on making better products, providing better services, and revolutionizing the way we interact with one another.

So the advice is really very clear to Ripple - come to us and get our formal consent to informally label your tokens non securities until that time when we will legislate with further clarity.  This is very good news for Ripple/XRP because it is guidance to any judge faced with making a court judgement and a green light to continue with the job they have already started.

Edited by Julian_Williams

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2 hours ago, DividendGamer said:

Really happy that it is looking like common sense will prevail over this issue that should have been put to bed long ago.

Well when it was announced that Ripple finally ponied up for a high profile lobbying firm in Washington to "educate" lawmakers it was at that point I let out a sigh of relief.  The BTC maximalists were lobbying for quite a while and in my opinion were closer to successfully closing the door on Ripple and XRP than we all thought.  This common sense prevailing certainly had its cost in lobbying fees.  At least they got it done!  Now we can go about becoming the global standard for cross-border payments...

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56 minutes ago, lucky said:

Chris Larsen at Money 20/20

"Frankly I think there’s a couple of very large bitcoin holders, that have been very influential in Washington, that made a huge mistake. They should have gotten the industry together, all the major platforms, and should have emphasized this how it’s going to be a serious industry, that this is going to be the 2nd internet, fundamentally to change things. But they went with the message, give Bitcoin a pass, and by the way why don’t you try to kill those other platforms. How do you make the regulation work? And you know that has backfired spectacularly in my opinion."

fantastic link, didn't see it in October.

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Truly a great decision by Ripple to have been wise enough to approach the regulators. 

Seems to me much of this is a result of legitimate businesses or industry leaders engaging regulators. I would imagine Ripple is once again ahead of the pack.

I wonder how this opinion affects smaller, less organized tokens that don't have representation or leaders? This will remove the wheat from the chaff. 

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A very interesting moment,  a great read and insight to what Hester thoughts are, certainly seems a positive step forward for clarification for XRP. To have her express that publicly and the congressman sending a clear message they want change to a outdated law , definitely a change in the wind and our sails should set soon. :d_sunny:

"Ambiguity is not all bad, of course. We might be able to draw clearer lines once we see more blockchain projects mature. Delay in drawing clear lines may actually allow more freedom for the technology to come into its own.[22]

Congress may resolve the ambiguities engendered by Howey by simply requiring that at least some digital assets be treated as a separate asset class. Congressmen Warren Davidson and Darren Soto recently introduced a bill in the House intended to amend the federal securities laws to do just that, provided that the token truly operated in a decentralized network.[23] Such an approach would facilitate more tailored disclosure. "

Article in Roll Call covering news on the hill since 1955. https://www.rollcall.com/news/congress/the-future-holds-cryptocurrency-based-funds-says-secs-jackson She is definitely pro cryptocurrency,  this was retweeted by ErisX_digital 

Edited by Truckdriver

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7 hours ago, Julian_Williams said:

He is clearly closing the door on making hard and fast rules at this early stage - he tells us such clarity is years away

he then goes on to explain the nuanced approach that would be needed

and returns to his preferred method of regulation in the interim period

and he ends with the same: 

So the advice is really very clear to Ripple - come to us and get our formal consent to informally label your tokens non securities until that time when we will legislate with further clarity.  This is very good news for Ripple/XRP because it is guidance to any judge faced with making a court judgement and a green light to continue with the job they have already started.

For the record. Hester Maria Peirce is a Woman. Not a Man.

https://en.wikipedia.org/wiki/Hester_Peirce

 

Whist she might be attempting to close the door on early hard and fast rules, the allusion is enough to help Ripple and Mary Jo White set a new precedent in court that XRP is not a security. The nuanced approach is one thing. A legal case is another. 

The ruling won't neccesarily determine what XRP is, but it likely will determine what it ISN'T.

Edited by Fazzyfocus

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