Ripple Labs has formally responded to the U.S. Securities and Exchange Commission (SEC) after Hester Peirce, head of the Crypto Task Force, called for industry input. Peirce titled her request “There must be some way out of here,” signaling a shift in the SEC’s approach to digital asset regulation. She stressed the need to eliminate confusion caused by past leadership regarding crypto classification and enforcement.
Ripple seized this moment to challenge the previous SEC administration led by Gary Gensler. The company argued that earlier regulatory guidance lacked clarity, added unnecessary complexity, and had no solid legal foundation. It claimed that the former approach allowed the SEC to act without clear limits, making it harder for crypto firms to comply with regulations.
SEC’s Ambiguous Strategy Hurts the Industry
Ripple accused the SEC of intentionally creating regulatory uncertainty. It argued that the agency used confusion as a tactic to maintain broad enforcement authority without closely following federal securities laws. This approach, according to Ripple, created unnecessary risks for businesses and made compliance unpredictable.
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To fix regulatory issues, Ripple urged the SEC to regulate only assets that meet the established definition of securities. It argued that many digital tokens, especially those without profit-sharing mechanisms, should not fall under SEC control.
Ripple also called on the SEC to stay within the limits of current laws. It emphasized that Congress alone has the power to introduce new regulations, and the SEC should not interpret laws too broadly. The company warned that the agency’s history of stretching legal definitions created business risks and confusion.
Related article: Ripple Vs. SEC: The $3.5 Trillion Crypto Market at Risk
Additionally, Ripple demanded clear and direct regulatory guidelines. It supported recent SEC statements confirming that meme coins do not qualify as securities. The company insisted that transparent rules would reduce legal uncertainty and help crypto businesses operate with confidence.
Ripple’s Response Could Shape Future Rules
Ripple remains entangled in a legal battle with the SEC, though the case is nearing resolution after the agency withdrew its appeal. The only remaining issue is Ripple’s cross-appeal, which legal experts believe could be dropped if both sides reach a settlement.
As the SEC reassesses its stance on crypto regulations, Ripple’s proposals add pressure for a more structured and transparent approach. If the agency takes these recommendations seriously, they could set a clearer path for the entire digital asset industry.
