The SEC’s enforcement action against Ripple and its principals illustrates the factors used to determine if a digital asset is a security. In an article published on February 11, 2021, Ciaran Connelly discusses the implications and liabilities surrounding digital currencies similar to bitcoin. The legal precedence is rapidly changing and blockchain companies should be careful while the regulatory landscape continues to evolve.
“Over the past month, Ripple Labs Inc. has been beset by legal difficulties stemming from its sale of XRP—a digital asset or crypto-token,” writes Ciaran. “In late December, the Securities and Exchange Commission filed an enforcement action alleging that XRP is a security and that Ripple and its principals had sold nearly $1.4 billion worth of XRP in unregistered securities sales since 2013.”
To read the article in full, click here.