Ripple supports SEC proposed crypto asset regulations

Ripple has submitted a formal comment to the U.S. Securities and Exchange Commission (SEC) expressing support for the proposed ‘Regulation Crypto Assets’ framework. In its submission, the blockchain payments company argued for a clear distinction between a crypto asset itself and the investment contract associated with it. Ripple maintains that ‘it is the investment contract, not the crypto asset itself, that is the security.’

The company advocates for holistic rules to replace the current ‘case by case, coin by coin’ enforcement approach, which it claims has pushed innovation offshore. Ripple suggests that the determination of whether an investment contract exists should be based on the specific promises and commitments made by an issuer, rather than subjective metrics like the degree of network decentralization.

Additionally, Ripple requested safeguards for market participants, such as exchanges and brokers. It proposed that these entities should be able to rely in good faith on ‘Form TR’ filings, which report the use of safe harbor provisions. Ripple also called for consistent treatment of crypto assets under various laws, including the Investment Company Act and the Investment Advisers Act, once they are separated from an investment contract.