Every day brings new developments in the SEC-Ripple (XRP) war. Most recently, crypto derivatives exchange Bitnomial filed a lawsuit against the SEC, challenging the classification of XRP futures as a security.
Bitnomial has filed a lawsuit against the SEC, claiming that it has “inappropriate” jurisdiction over its XRP Futures product, US media outlet Fox Business reported.
Bitnomial stated in its lawsuit that it filed an application for an XRP Futures contract with the Commodity Futures Trading Commission (CFTC) following the conclusion of the XRP lawsuit.
According to Bitnomial’s lawsuit, the SEC contacted them shortly after the XRP filing and told them that XRP Futures were securities futures subject to joint SEC and CFTC jurisdiction and that Bitnomial would violate federal securities laws if it continued listing them.
According to Bitnomial’s petition, the SEC also said that Bitnomial must comply with additional requirements, including registering as a national securities exchange, before listing XRP Futures.
The petition included the following statements:
“The SEC takes the position that the underlying asset, XRP, is an investment contract and therefore transactions in XRP constitute a security under the Securities Exchange Act.
However, Bitnomial disagrees with the SEC's view that XRP is an investment contract and therefore a security, and that XRP Futures are therefore security futures.
And he argues that XRP is not a security, so XRP futures should not be classified as security futures.”
While the SEC’s claim that XRP futures are securities futures has further intensified the rivalry between the SEC and CFTC, who are competing for sole jurisdiction over crypto assets, the question of whether cryptocurrencies should be classified as securities or commodities remains the biggest question. Since there is no clear regulation or opinion on this issue, the status of cryptocurrencies is decided by the courts through lawsuits.
*This is not investment advice.