Crypto Exchange Ripple Urges SEC to Focus on Clear Regulatory Guidelines for Crypto Firms and Abandon Past Enforcement Tactics
According to Ripple, past actions by the Commission have caused confusion for the cryptocurrency industry by enforcing standards that were not written into law.
Ripple Claims Past SEC Enforcement Actions Created Confusion in the Crypto Industry
In response to the SEC’s statement on February 21, 2025, titled “There Must Be Some Way Out” (“RFI”), Ripple insists that the Commission must prioritize providing legal clarity for cryptocurrency companies.
The exchange referenced Bob Dylan’s lyric, “Too much confusion, I can’t get no relief,” suggesting that the previous government had only caused confusion.
It further stated that the previous enforcement strategy contradicted the crypto task force’s objective of determining whether assets meet the clear criteria of a security or investment contract.
In response to this sentiment, Stuart Alderoty, Ripple’s Chief Legal Officer, even claimed that the Commission thrived in the confusion to cover up its failure to comply with the law.
Ripple Responds to Commissioner Hester Peirce’s February 21 Statement
Today, @Ripple submitted its response to Commissioner Hester Peirce’s February 21 statement, “There Must Be Some Way Out,” calling for public input on crypto classification regulations.
Dylan’s lyrics continue, “Too much confusion, I can’t get no relief.” Previously… – Stuart Alderoty (@s_alderoty) March 21, 2025
Ripple Calls for More Clarity and Return to First Principles
The exchange now hopes the SEC will provide more clarity and return to first principles. It commented:
“As the crypto task force seems to recognize, the SEC should return to first principles and work within the scope of existing regulations to provide the direct market guidance that has been lacking so far.” – Ripple
Ripple Claims SEC Has No Jurisdiction Over Most Digital Assets and Their Trading
Ripple even claims that the SEC has no jurisdiction over most digital assets and their trading to date. It adds that the agency can only regulate assets classified as “securities” and their trading, as defined under the Securities Act.
The cryptocurrency firm also believes that points and yields on public networks are different from securities and has called for clarification on their policy.
Support for Safe Harbor and Regulatory Sandbox Approaches
Additionally, the company reiterated its support for safe harbor provisions and regulatory sandboxes, which have been successful in the UK, Switzerland, and Singapore.
The exchange believes that a token safe harbor proposal could foster the growth of blockchain projects without them being classified as securities.
Ripple Accuses SEC of Misusing Legal Definitions, Including the Howey Test
However, Ripple accuses the SEC of distorting certain legal requirements of communication, including the application of the Howey Test. The cryptocurrency company argues that even without binding agreements or profit participation requirements, the agency misused the test to classify digital assets as securities.
Ripple claims that this approach only creates uncertainty and hinders blockchain projects from launching or scaling in the U.S.
However, the exchange agrees with the SEC’s decision to classify meme coins as non-securities, claiming that this is a step forward in terms of clear regulation. Moving forward, the company believes that all future regulations should be based on existing laws, not arbitrary construct standards that may unsettle the market.
