Media personality and FOX Business Senior Correspondent Charles Gasparino has weighed in on the ongoing legal battle between Ripple Labs Inc and the U.S. Securities and Exchange Commission (SEC). Taking to Twitter, Charles posed what he termed a “serious question” about the status of the XRP coin that is under contention as a security between both parties.
Charles pointed out that per the Howey Test, an asset becomes a security when the buyers of an asset have some form of “reasonable expectation of profits to be derived from the efforts of others.”
Based on this premise, he asked what profits those who purchased the cryptocurrency from the company’s executives expected to make at the end of the day. In his words:
Per Howey, an asset that is sold becomes security when the purchaser has a ‘reasonable expectation of profits to be derived from the efforts of others’ What profits were #XRP buyers of @Ripple exec sales expecting from Ripple itself? Serious question as the @SECGov case continues.
The case between the U.S. SEC and the blockchain payments labs has stirred a lot of division among legal experts, but thus far, many believe the odds are skewed to favor Ripple.
Ripple v. SEC: Judgment approaching
The duo of Ripple and SEC are now looking forward to a judgment over the case that has been going on since December 2020. Earlier, many had advocated for an out-of-court settlement, an option that was not acted upon.
Many in the digital currency ecosystem consider this lawsuit a pivotal one for the future of the industry and the regulatory oversight from the SEC. Should this case end in Ripple’s favor, it will form a precedent upon which future related cases will be built.
