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Top Crypto Lawyer Says There’s a Core Problem With XRP As Ripple’s Day in Court Approaches


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I don't understand this. Ripple has sold private stock all throughout its existence, from venture rounds on up. Clearly, that's the security, not XRP. XRP is not stock, it's a token for using the XRPL. Apparently, something that's not intrinsically a security can be sold as one by attaching certain promises to it, but that's not the same thing as XRP itself being a security.

If I make a new line of vending machines that don't accept normal money but only my unique tokens and then I sell the tokens, is that a security? I can't see how it is, the tokens are what make the machines work, not an investment in my company. If I promise people that the value of the tokens will increase if my machines become popular and the company makes more profits - I may be guilty at that point. But the tokens are still just vending machine tokens, right?

Edited by brianwalden
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no idea who this lawyer is, but he doesn't get it.  SEC are not saying XRP a is a security, they are saying the contracts by which XRP has been marketed by ripple are "security contracts".  Nowhere in the lawsuit does SEC argue that XRP is a security, and SEC have said many times that ICO tokens can start as securities and morph into non securities.  I think SEC have even hinted exchanges can continue to trade XRP, but Ripple cannot market/sell XRP whilst they own all these XRP. 

Edited by Julian_Williams
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2 hours ago, Julian_Williams said:

SEC are not saying XRP a is a security, they are saying the contracts by which XRP has been marketed by ripple are "security contracts".  

This is exactly what they're saying, in their exact words, which is why everyone is laughing at them for even filing it.

Since 2013....what is wrong with these morons? Coinbase didn't list XRP until 2018(??) but that was OK, now it's not? C'mon SEC, really....

screenshot_20210218_132744.thumb.jpeg.6a11bbd08458c343485f124cbc6a5117.jpeg

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9 minutes ago, jetbrzzz said:

This is exactly what they're saying, in their exact words, which is why everyone is laughing at them for even filing it.

Since 2013....what is wrong with these morons? Coinbase didn't list XRP until 2018(??) but that was OK, now it's not? C'mon SEC, really....

screenshot_20210218_132744.thumb.jpeg.6a11bbd08458c343485f124cbc6a5117.jpeg

Thanks, I had not seen that.

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1 hour ago, jetbrzzz said:

This is exactly what they're saying, in their exact words, which is why everyone is laughing at them for even filing it.

Since 2013....what is wrong with these morons? Coinbase didn't list XRP until 2018(??) but that was OK, now it's not? C'mon SEC, really....

screenshot_20210218_132744.thumb.jpeg.6a11bbd08458c343485f124cbc6a5117.jpeg

So the SEC shoot themselves in the foot in the very 1st Paragraph of their 71 page " complaint " Marvellous !!!  I can sense a massive victory ahead...

One Direction Interview GIF by The Tonight Show Starring Jimmy Fallon

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3 hours ago, jetbrzzz said:

This is exactly what they're saying, in their exact words, which is why everyone is laughing at them for even filing it.

It's more nuanced than that. Th wording is poor, sure, but they're NOT saying everyone who owns XRP owns a security, they MEAN that XRP sales in association with Ripple/Founders constitute a securities violation. I think, personally, they just went in with strong wording like a bully starts a negotiation. But the point is, it's the transaction(s) not the asset as a whole. And/or both. Hence the nuance and confusion, and why we need this case and overall, it'll be good for everyone.

That said, I side with the SEC in some of their claims against the Founders sales. 

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38 minutes ago, Julian_Williams said:

I guess the case was carefully crafted to be all about the way the tokens were sold (which made it all about security contracts), rather than about DAs being securities.  Now it is about whether DAs are securities?  Just my guess..

Loads of possible outcomes and repurcussions for the wider market. I don't think the SEC have structured their case well (seems rushed, maybe personal or political posturing type job) but what do I know as I'm not a legal pro. But a settlement is probably a good all-round result. 

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7 hours ago, thinlyspread said:

It's more nuanced than that. Th wording is poor, sure, but they're NOT saying everyone who owns XRP owns a security, they MEAN that XRP sales in association with Ripple/Founders constitute a securities violation. I think, personally, they just went in with strong wording like a bully starts a negotiation. But the point is, it's the transaction(s) not the asset as a whole. And/or both. Hence the nuance and confusion, and why we need this case and overall, it'll be good for everyone.

That said, I side with the SEC in some of their claims against the Founders sales. 

I understand the whole "investment contracts" angle they're trying to float.

Also if the asset is not a security, then how can buying/trading it be selling a security? Like just makes no sense. The asset would have to be a commodity or currency, whatever.

Vitalik says on video straight up they used BTC=>ETH sales to fund Ethereum development. By all logic, Ethereum should have been listed in this lawsuit as well. If BG and CL sold securities, so did Vitalik, so get him in the line up as well. If they charge BG and CL with unregistered security sales, Vitalik needs to be next, so be it, but no more of this cherry picking people to go after. Go after everyone or no-one.

Then the SEC just looks the other way while XRP trades on exchanges for almost a decade, then la-di-da here's a lawsuit.

Calling BS on them, not giving these idiots a pass. I can't excuse their lazy arguments and double standards.

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38 minutes ago, jetbrzzz said:

I understand the whole "investment contracts" angle they're trying to float.

Also if the asset is not a security, then how can buying/trading it be selling a security? Like just makes no sense. The asset would have to be a commodity or currency, whatever.

The oranges in the Howey case were not securities either. But the contract to grow and sell them on behalf of the buyer of the land constituted an investment contract. I'm not saying that this ancient law should apply to XRP sales - it's ridiculous for several reasons - but the SEC takes a different view.

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