In a bold move, Ripple has once again called on the U.S. Securities and Exchange Commission (SEC) to bring long-overdue clarity to cryptocurrency regulations. The company argues that the lack of clear rules has stifled innovation, created confusion for businesses and investors, and slowed down the growth of the digital asset industry. This renewed push from Ripple comes after Hester Peirce, head of the SEC’s Crypto Task Force, requested public input on how crypto assets should be classified. Her call for feedback, titled “There Must Be Some Way Out of Here,” signals an effort to clean up the regulatory mess left by previous SEC leadership.
Ripple, however, is not holding back. The company has openly criticized the SEC’s past approach, calling it inconsistent, overly complicated, and legally weak. Now, Ripple is presenting a clear, three-step plan aimed at cutting through the confusion and providing a framework that could finally bring regulatory clarity to the cryptocurrency industry.
Ripple Criticizes SEC’s Previous Leadership
In its official response, Ripple strongly criticized the SEC’s former chairman, Gary Gensler, arguing that the agency’s past approach to crypto regulation was not only unclear but also overly complicated and lacking legal support. The company suggested that the SEC had intentionally created confusion in an attempt to cover up its failure to follow proper legal processes. Ripple accused the agency of regulatory overreach and inconsistency, stating that it had unfairly targeted certain crypto projects while letting others operate with minimal oversight.
Ripple’s critique of the SEC’s handling of crypto regulations isn’t new, but this time, the company is taking a more structured approach. It has outlined three key steps that it believes the SEC must take to improve regulatory clarity and ensure a fair, transparent, and predictable framework for all digital assets.
Ripple’s Three-Step Plan for Clearer Regulations
Ripple’s proposal is centered around three key principles designed to bring transparency and fairness to crypto regulations. The company believes that by adopting these steps, the SEC can create a more predictable and innovation-friendly environment.
1. Focus on True Securities
Ripple argues that the SEC should only regulate assets that legally qualify as securities under existing federal law. The company emphasized that many digital assets, particularly those that do not generate profits or yield, should not be classified as securities. Ripple believes that a clear distinction between securities and non-securities is crucial for fostering innovation while ensuring that investors are adequately protected.
Currently, the SEC uses the Howey Test to determine whether an asset is a security. However, Ripple contends that the test has been inconsistently applied to crypto assets, leading to confusion and uncertainty. The company is urging the SEC to provide clearer definitions and avoid blanket classifications that could stifle the industry.
2. Enforce Existing Laws Instead of Creating New Ones
Ripple is calling on the SEC to enforce the laws already in place rather than introducing new, complex regulations that could create further confusion. The company stressed that only Congress has the authority to create new laws, and the SEC’s role should be limited to enforcing existing regulations fairly and consistently.
The SEC has faced criticism for what many see as a regulation-by-enforcement approach, where it targets crypto companies through legal actions instead of providing clear guidelines. Ripple believes that this approach is counterproductive and only serves to push innovation offshore to countries with more favorable regulatory environments.
3. Provide Clear Guidelines
Ripple is urging the SEC to take a more transparent approach to crypto regulations. The company praised the agency’s recent decision to clarify that meme coins are not securities, arguing that such clear guidance is beneficial for the market. Ripple is now pushing for similar clarity across the entire crypto industry, calling for explicit guidelines on the classification of various digital assets.
By providing clear regulatory guidelines, the SEC could help reduce uncertainty and foster a healthier crypto ecosystem. This, in turn, would encourage responsible innovation while protecting investors from fraudulent schemes.
Ripple vs. SEC Lawsuit Nears Its End
While Ripple continues its fight for clearer regulations, the company is also close to wrapping up its long-running legal battle with the SEC. The case, which began in 2020, has been one of the most closely watched legal battles in the crypto space.
In a surprising move, the SEC has dropped its appeal against Ripple, leaving only Ripple’s cross-appeal as the final legal step. Many legal experts believe that Ripple will withdraw its appeal once it reaches a favorable settlement with the SEC. If this happens, it could mark a turning point for the crypto industry, setting a precedent for how digital assets are regulated in the future.
The Impact on XRP and the Crypto Industry
Ripple’s fight with the SEC has had a significant impact on XRP, the company’s native cryptocurrency. Over the past few years, XRP has faced delistings from major exchanges, price volatility, and uncertainty about its regulatory status. However, with the legal battle nearing its conclusion, many believe that XRP could see a resurgence in both adoption and price stability.
Moreover, Ripple’s push for regulatory clarity could benefit the entire crypto industry. If the SEC adopts a more transparent and predictable approach, it could encourage greater institutional adoption and investment in digital assets. A clear regulatory framework could also help prevent future lawsuits and regulatory conflicts, allowing companies to focus on innovation rather than legal battles.
Ripple’s call for clearer crypto regulations comes at a crucial time for the industry. With growing interest from institutional investors, increased adoption of blockchain technology, and ongoing regulatory scrutiny, the need for transparent and fair rules has never been greater.
By focusing on true securities, enforcing existing laws, and providing clear guidelines, Ripple believes that the SEC can create a more predictable and innovation-friendly regulatory environment. As the legal battle between Ripple and the SEC nears its end, all eyes will be on how the agency responds to these calls for reform.
For now, the crypto industry waits to see whether the SEC will embrace this opportunity to bring long-overdue clarity or continue down a path of regulatory uncertainty. Either way, Ripple has made its stance clear: the time for change is now.
