Attorney Jeremy Hogan claims that the SEC has failed to prove that XRP is a security in its lawsuit against Ripple
In its litigation against Ripple Labs, the U.S. Securities and Exchange Commission (SEC) has not demonstrated that XRP is a security, according to one crypto legal expert.
In an extensive thread, attorney and XRP supporter Jeremy Hogan explains to his 263,300 Twitter followers why, in his opinion, the SEC has failed to establish that XRP is a security.
In late 2020, the SEC filed a lawsuit against Ripple alleging that the company sold XRP as an unregistered security.
“First, according to the legal definition of a security, XRP can only POSSIBLY be classified as an investment contract. It is neither a commodity nor a bond… Even the SEC admits it: “investment contract.”
According to Hogan, the SEC has not yet demonstrated that there was a contract of investment for XRP investors, one of the defining characteristics of a security under the Howey Test.
Instead, it contends that the purchase agreement is the only requirement, and that is all it demonstrates. However, this argument separates ‘investment’ from ‘contract’…
As a straightforward purchase cannot be an “investment contract,” it is merely an investment (similar to purchasing an ounce of gold), as Ripple is under no obligation to do anything other than transmit the asset.”
According to Hogan, securities laws were not enacted to prevent investors from making poor decisions, but rather to require companies to make certain disclosures about the contract the purchaser is entering.