Ripple wants to know why Ether isn’t a security. The company has legal problems, as the SEC believes that the XRP issue was subject to the provisions on the issue of shares.
Ripple: Ether is also a security?
On January 29, Ripple Labs filed a response to the SEC complaint. The Company believes that XRP is not a security.
A Ripple representative said Cointelegraph:
“The SEC has clearly picked two winners and has ignored a thriving strong industry that is much bigger than Bitcoin and Ether. (…) we applied for the Freedom of Information Act (FOIA) for more information on how the SEC determined Ether status. “
However, SEC officials have repeated many times that although the pre-sale of ETH a few years ago may have been a securities issue offer at the time, Ether itself is decentralized enough to qualify as a commodity, and thus its trading in the US falls under the jurisdiction of Commodity Futures Trading.
The pre-sale of Ether took place many years before the SEC issued its DAO report. It showed that some cryptocurrencies were and are securities.
The following years brought huge confusion as to what qualifies the initial coin offer (ICO) as a share issue and what does not. It’s important to remember that Bitcoin that has never had a pre-sale does not appear in these types of debates. Nevertheless, the SEC also never pursued the Ethereum Foundation. Nevertheless, in December, the commission went against Ripple. She accused the company that the sale of XRP was an ongoing issue of shares.
Ripple, in turn, defends itself with the fact that Bitcoin and Ether are controlled by Chinese mining pools.
The SEC case against Ripple was predictable and has been for a long time. Its start means great problems for the company. It’s not just about the fact that XRP’s rate fell sharply when the authorities started the procedure. It is worth adding that many leading exchanges removed XRP from their platforms, probably fearing the consequences of SEC actions.
ETH and BTC are probably safe. The future of XRP, however, is in question.