• Ripple’s CTO has challenged the SEC’s choice of words about the nature of security classification in the case between Ripple and the US Securities and Exchange Commission.
• Lawyer Bill Morgan noted a shift in the SEC’s verbiage, which Ripple’s Chief Technical Officer David Schwartz called “completely incoherent.”
• Schwartz drew an analogy between XRP token and Howey’s cultivation of orange groves to clarify XRP’s legal status while Morgan questioned Judge Torres‘ ruling on XRP sales.
Subtle linguistic shifts have ignited intense debates amid the ongoing SEC vs. Ripple legal clash. Ripple’s CTO has challenged the SEC’s choice of words about the nature of security classification while lawyer Bill Morgan has noted a shift in the SEC’s verbiage. Moreover, David Schwartz has drawn an analogy between XRP token and Howey’s cultivation of orange groves to clarify XRP’s legal status while Morgan questions Judge Torres‘ ruling on XRP sales.
SEC vs Ripple Legal Clash
The court ruling between blockchain giant Ripple and United States Securities and Exchange Commission (SEC) has faced scrutiny as experts dissect fusion of transactions and investment contracts amidst their ongoing legal battle.
Shift in Verbiage
Lawyer Bill Morgan had underscored a notable shift in the SEC’s verbiage, noting that term „selling digital asset securities“ had evolved into “crypto assets offered and sold as securities” in a settlement involving cryptocurrency exchange Bittrex and its co-founder William Shihara. Furthermore, Ripple CTO David Schwartz commented on these changes, vehemently challenging what he referred to as a „subtle but significant change“ in the SEC’s language, a point initially brought forth by attorney Morgan on 11th August.
Analogy Used by Schwartz
Ripple CTO David Schwartz drew an analogy between XRP token and Howey’s cultivation of orange groves; emphasizing that similar to real estate agents who marketed sold latter as securities they would not be contravening any laws if they chose to sell these same orange groves through straightforward asset transactions. Furthermore, he asserted that labeling something as a security does not inherently classify it as such; citing that Howey case did not entail brokers reselling Howey trees but rather revolved around transferring contractual rights and obligations .
Morgan Questions Judge Torres‘ Ruling
Morgan also delved into specific facet Judge Torres‘ ruling wherein she amalgamated sales to on-demand liquidity (ODL) customers with other transactions involving institutions; however Morgan questioned rationale behind this amalgamation along with why this particular category was singled out for especially harsh treatment