- Professor Reiners has urged Congress to close the gaping regulatory issues in the cryptocurrency spot market.
- Reiners’ testimony about investment contracts is in agreement with Ripple’s claim that XRP should not be considered a financial instrument.
Stuart Alderoty has been appointed as Ripple’s Chief Legal Officer. responded The testimony of Professor Lee Reiners before Congress provided a unique perspective on the ongoing legal dispute between Ripple and United States Securities and Exchange Commission.
Reiners, who is both pro-SEC as well as anti-crypto, has acknowledged that the SEC recently lost the Ripple Case, highlighting three important factors of great significance to the crypto industry.
Prof. @leereiners Although he has a lot to say, this pro SEC/anti cryptocurrency witness also acknowledged Ripple’s victory in the Ripple court case.
1. Only Congress has the power to close the regulatory gaps in crypto-spot market.
2. Securities…— Stuart Alderoty (@s_alderoty) September 20, 2024
Crypto Laws: Regulatory Gaps, Decentralization and the Question of Regulatory Gaps
Reiners began by identifying a regulatory gap that exists in the cryptocurrency spot market. He pointed out that the SEC and the Commodity Futures Trading Commission do not currently have jurisdiction over this industry. This observation indicates a flaw with the existing regulatory framework of cryptocurrency.
Reiners believes Congress It is important that the government takes a greater role to close this regulatory gap. Alderoty, Ripple’s Alderoty, agreed and stressed the importance of legislation to address the evolving crypto ecosystem.
Reiners addressed decentralization as a key issue in securities law. He criticised the idea of securities regulation being based upon a “mystical” William Hinman’s 2018 address as former SEC director, referred to the decentralization threshold.
This statement sparked debate in the crypto-community, primarily because it suggested that certain cryptocurrency could be immune to securities restrictions if achieved a sufficiently high level of decentralization.
Reiners’ position is in line with that of the crypto industry as a whole, which has stated for years that decentralization shouldn’t be used to decide whether an asset should be classified as a security.
Reiners addressed investment contracts as well, using analogies with the Howey Test and orange groves. He stressed that an orange grove, for example, which is the subject of a contract of investment, does not constitute a security. If something is to be considered as a security it has to have an accompanying management contract.
Ripple has argued that XRP is not a security because it does not fit the definition of an investment contract.
Crypto Regulation and the Impact of SEC Leadership Change
Reiners made a comment that stands out as one of his most memorable. “SEC chairs come and go,” It is implied that the landscape of regulation could change dramatically with a new leadership.
The Ripple case is a good example of how regulatory interpretations can change over time. This means that future cases may have different outcomes. SEC A new approach to cryptocurrencies is taken by the leadership.
The crypto community is closely monitoring these developments, but there are still doubts about XRP’s future. Specifically, whether or not the SEC will appeal the Ripple verdict by the October 7 deadline.
The XRP value is now under downward pressure because of this lingering uncertainty. $0.5843 This post was published at a time when the market represented a small increase. 0.55% The last 24 hours have seen a fall in the number of people.
SBI Holdings has also made significant progress with the research of the integration between token-based digital currency and central bank currencies. CNF claimed that token-based bank deposits are being integrated with central bank digital currencies. reportSBI Holdings is a member of Project Agora. This project aims at examining how wholesale CBDCs and tokenized commercial banks deposits can be combined on one ledger.
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