Ripple's Chief Legal Officer, Stuart Alderoty, recently criticized the United States Securities and Exchange Commission (SEC) for its repeated use of the term "crypto asset security." Alderoty argues that the phrase has absolutely no legal basis. The lawyer's comments were made in response to the SEC's recent actions, including a warning in an Aug. 30 filing that it could challenge any plan by the now-defunct crypto exchange FTX to use stablecoins to repay creditors. The SEC believes FTX's portfolio contains "crypto asset securities."

Alderoty contends that the SEC is trying to mislead judges by using the term, and stated on Sept. 2 that "'crypto asset security' is nowhere to be found in any statute—it's a fabricated term with no legal basis." He also criticized the SEC for trying to deceive the judiciary with such language. This criticism is very similar to concerns that were raised in an August update to the SEC's legal battle with crypto exchange Kraken, where the Federal Court for the Northern District of California also questioned the clarity of the "crypto asset security" concept.

Alderoty also addressed the SEC's Wells notice to the NFT marketplace OpenSea, which claimed that the tokens sold on the platform might be unregistered securities. He pointed out a precedent from over 40 years ago when the SEC ruled that an art gallery was not required to register with the agency, even if buyers purchased art with investment intentions. The SEC had decided in 1976 that the Art Appraisers of America, which was representing artist William Nelson, did not need to register when selling lithographs and print drawings, even if collectors viewed them as potential investments.

Source: https://coinpaper.com/5280/ripple-s-legal-chief-challenges-sec-s-crypto-asset-security-term

The information provided in this article is for informational and educational purposes only, based on news and sources gathered from the internet. This content should not be considered as investment advice, financial guidance, or a suggestion to buy or sell any digital assets. Before making any financial decisions, we recommend consulting with a professional financial advisor and conducting your own research. The author and the blog are not responsible for any losses or damages that may arise from using this content.