Ripple (payment protocol): Difference between revisions - Wikipedia

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On April 13, 2021, SEC Commissioner [[Hester Peirce|Hester M. Peirce]] published the Token Safe Harbor Proposal 2.0, which is ″intended to provide Initial Development Teams with a three-year time period within which they can facilitate participation in, and the continued development of, a functional or decentralized network, exempt from the registration provisions of the federal securities laws so long as certain conditions are met.″<ref name="Safe Harbor 2.0">{{cite web |last1=Peirce |first1=Hester |title=Token Safe Harbor Proposal 2.0 |url=https://www.sec.gov/news/public-statement/peirce-statement-token-safe-harbor-proposal-2.0 |website=Public Statement |publisher=U.S. Securities and Exchange Commission |access-date=11 July 2021}}</ref>

The [[United States District Court for the Southern District of New York|district court]] issued its ruling on 13 July 2023 and stated that the XRP token sold by Ripple Labs was not a security in many cases: "XRP, as a digital token, is not in and of itself a 'contract, transaction, or scheme' that embodies the Howey requirements of an investment contract." However, if sold in institutional sales, or used as a fundraiser, it would be classified as a security in those uses. More specifically, the programmatic sale on [[cryptocurrency exchanges]] do not meet the third prong of the [[Howey Test]], so sales by exchanges are not securities. Judge [[Analisa Torres]] issued a [[summary judgement]] in the case after over two years of litigation between the SEC and Ripple, so the case could subsequently go to a full trial, or be [[United States courts of appeals|appealed]].<ref>[https://storage.courtlistener.com/recap/gov.uscourts.nysd.551082/gov.uscourts.nysd.551082.874.0.pdf District court summary judgement], pdf, 13 July 2023.</ref>{{cnbetter source}}

==Reception==