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Great day for crypto and for financial freedom in general. Great to see the justice system finally rebuking these unelected bureaucrats and placing some limits on the power they claim to have.
IANAL The court ruled that: - Ripple's sales of XRP to institutional buyers were investment contracts, but - programmatic sales via an anonymous exchange were not . The ruling emphasises the distinction between an asset and an investment contract. An orange grove isn't an investment contract. The sale of an orange grove may or may not be an investment contract. Determining whether or not is governed by the Howie test…
I liked the era when people vaguely claimed that their coins weren’t a security because securities need to be registered. It had an “I’m not an alcoholic, alcoholics go to meetings” flare to it. I tried to get in on the fun with a vaporware cryptocurrency, OrangeGroveCoin. It got a disturbing amount of investment interest.
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The judge referenced the Howey case, saying that just because you have an investment contract involving an orange grove, that doesn't mean the orange grove itself is a security. A security is a contract, not just anything that people trade around in a speculative way. William Hinman of the SEC said much the same thing in 2018: https://www.sec.gov/news/speech/speech-hinman-061418
This is pretty obviously the reasonable take. > A security is a contract, not just anything that people trade around in a speculative way. The scary thing IMO is that I think if you had enough big money trading bottlecaps or baseball cards, you'd quickly find them being considered a security. But words have to mean something. Things can't just be a "security" because they make the government feel insecure.
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Ripple still faces over $700m of unregistered security sales as part of the decision.
That's really not a lot of money for them to lose. This is a massive win for them and alt coins in general.
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Any speculative profit you hope to make on buying a limited edition Rolex is entirely reliant on the business of Rolex continuing to market the brand of Rolex. But if you don't have a formal contractual relationship with Rolex SA, then it's quite simply not an investment contract.
> Any speculative profit you hope to make on buying a limited edition Rolex is entirely reliant on the business of Rolex continuing to market the brand of Rolex. That is not at all true. Rolexes will continue to accrue value even (especially?) if the company goes out of business.
Indeed, the brand may retain value for some time even if the company goes out of business, perhaps even for a very long time. Nevertheless, that doesn't negate the fact that ongoing marketing efforts can amplify the brand's value and momentum, and the brand's inertia will be even stronger should the company cease to exist.
Another way to look at this is to put yourself in the shoes of a prospective buyer in 1923. Wouldn't you say in that situation you rely on the company's continuing marketing efforts to further the value of the brand? At what point in the last 100 years do you stop relying on the company's efforts?
Also, Rolex can easily destroy brand value with ill-considered promotional campaigns, so you rely on the company to not mess it up.
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Any speculative profit you hope to make on buying a limited edition Rolex is entirely reliant on the business of Rolex continuing to market the brand of Rolex. But if you don't have a formal contractual relationship with Rolex SA, then it's quite simply not an investment contract.
> Any speculative profit you hope to make on buying a limited edition Rolex is entirely reliant on the business of Rolex continuing to market the brand of Rolex. That is not at all true. Rolexes will continue to accrue value even (especially?) if the company goes out of business.
"partial" win!? It's hard to see what would be a "win" otherwise... It's going to have also larger implications - the SEC somehow manages to lose that one, it was hard to imagine or predict. If not even XRP is a security, there is truly no other coins which could be a security. Hate it or love it, but the SEC is simply going to lose all their other lawsuits EDIT: oh funny ... Reuters edited their title and removed "p…
> "partial" win!? It's hard to see what would be a "win" otherwise... It's going to have also larger implications - the SEC somehow manages to lose that one, it was hard to imagine or predict. If not even XRP is a security, there is truly no other coins which could be a security. This is explained in the article. It was good day for this crypto scam, but it wasn't all good news for them: > The ruling was also a parti…
And a ruling on ripple, which from architectural standpoint is rather stretching the bounds of what is typically thought of as a cryptocurrency -it isnt mined or staked and the blockchain is even more of a pretend decentralization gimmick than the rest of the tokens out there. it's much more like corporate scrip controlled by a handful of bank-owned validator supernodes. In terms of ownership structure it's what Bitcoin would drift into over time if the lightning network actually becomes the predominant means of interacting with it.