In the statement made by the US Jed Rakoff yesterday evening, it was announced that the SEC's lawsuit against Terraform Labs and Do Kwon will continue.
In his statement, Rakoff also referred to the lawsuit between Ripple and the SEC, and argued that the decision taken by Judge Torres in this case, which declared that XRP was not a security when sold on exchanges, was wrong. Rakoff said that there is no difference between stocks or institutional sales in terms of being a security.
Mike Selig, a cryptocurrency lawyer and former CFTC employee, commented on Twitter that Judge Rakoff's decision is “bad for the SEC” and shows why legislation is needed for clarity in the cryptocurrency world.
Selig also argued that Rakoff said in his decision that cryptocurrencies are not investment contracts, which is bad for the SEC.
Selig also pointed out that Judge Rakoff did not distinguish between primary and secondary sales of crypto assets, and this could have implications for other cases involving token sales.
Ripple Chief Legal Officer Stuart Alderoty Evaluates Judge Rakoff's Decision: “Unnecessary, Confusing, Not Binding”
Stuart Alderoty, Ripple's Chief Legal Officer, also reacted to the decision on Twitter, highlighting some points in the decision that he said support Ripple's case.
Alderoty also drew attention to Rakoff's statement that cryptocurrencies are not securities.
He also said that for a token to be an investment contract, there must be an agreement between the contracting parties, and that tokens that are not mixed together with other rights and promises are not securities per se. Alderoty added that Judge Rakoff's comment on the Ripple decision was “unnecessary, confusing and not binding.”
*Not investment advice.
