The Blockchain Association has submitted an amicus brief, or “friend of the court” brief, in support of Ripple Labs.
The Blockchain Association, a crypto advocacy organization located in the United States, has come out in support of Ripple Labs during its continuing legal struggle with the Securities and Exchange Commission (SEC), stating that the case might have significant implications for the future of the crypto sector.
In a post dated October 28, the advocacy organization stated it would file an amicus brief, often known as a “friend of the court” brief, in the SEC’s enforcement action against Ripple.
The association added, “This case, one in a long series of SEC attempts to regulate via enforcement, demonstrates the SEC’s efforts to solidify and justify its too broad interpretation of the Howey test.”
The Howey test decides what constitutes an investment contract and is therefore subject to U.S. securities regulations.
In their brief, the Blockchain Association explained why, in its opinion, the SEC and Chairman Gary Gensler’s interpretations of securities rules might have “devastating implications” on the cryptocurrency business.
They say that blockchain technologies have several applications throughout the crypto business; tokens may be used to pay for products and services, transfer intellectual property rights, monitor inventories, and for a particular purpose in a certain blockchain project.
If securities laws were applied to such tokens, even if filtered by the Howey test, it would severely limit the usefulness of those networks.
The group further asserts that the SEC disregards Supreme Court and Second Circuit decisions establishing that international transaction are outside the SEC’s jurisdictional reach.
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