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Ripple XRP vs SEC Update: Ripple Replies to Commissioner Peirce

Ripple XRP vs SEC Update: Ripple Replies to Commissioner Peirce

CryptotimesCryptotimes2025/05/28 09:00
By:Ronak KumarDhara Chavda

Ripple criticized SEC’s vague rules like “fully functional” and “decentralized,” saying Congress should decide these matters, not regulators.

Ripple has responded to SEC Commissioner Hester Peirce’s recent “New Paradigm” speech with a fresh letter, shared by its Chief Legal Officer, Stuart Alderoty, on X (formerly Twitter). 

In the letter , Ripple thanked the SEC’s Crypto Task Force for their May 20, 2025, meeting and offered clear points on why most crypto tokens, including XRP, are not securities.

Today, @Ripple submitted an additional letter to the SEC’s Crypto Task Force addressing a key question from Commissioner Peirce’s “New Paradigm” speech: When does a digital asset separate from an investment contract?

We appreciate the continued engagement with the Task Force.…

— Stuart Alderoty (@s_alderoty) May 27, 2025

Ripple supported its argument by citing legal analysis from Lewis Cohen, who said crypto assets sold on secondary markets are not usually considered securities. 

The decision pointed out Judge Torres’ 2023 ruling which stated that trading XRP on exchanges is not considered a security, but the initial sales to institutions were considered investment contracts.

The letter criticized vague SEC standards like whether a token is “fully functional” or “sufficiently decentralized,” calling them confusing for the market. Ripple argued that such matters should be decided by Congress, not regulators.

Ripple proposed a straightforward framework: if a token was once part of an investment contract, it should no longer be treated as such when all promises to the buyer are fulfilled and the holder has no rights over the issuer.

To support innovation, Ripple also called for a safe harbor rule to protect honest crypto projects as they grow. They suggested using network maturity, not decentralization, to decide regulation, pointing to open, long-running, high-value networks without central control.

With this bold move, Ripple aims to push the SEC toward fairer, clearer crypto rules that match today’s digital asset reality.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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