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Fungible cryptos in secondary sales are not securities, Ripple tells SEC

Ripple, the blockchain company behind XRP, argued that fungible cryptocurrencies are not securities when transferred in secondary transactions in a recent letter sent to the US Securities and Exchange Commission (SEC).

In its May 27 letter, Ripple cited US attorney and crypto law thought leader Lewis Cohen to support its claim. In his widely cited 2022 paper, “The Ineluctable Modality of Securities Law: Why Fungible Crypto Assets Are Not Securities,” he wrote:

“[T]here is no current basis in the law relating to ‘investment contracts’ to classify most fungible crypto assets as ‘securities’ when transferred in secondary transactions.”

In his paper, Cohen explained that in secondary transactions, an investment contract transaction is generally not present. He further claimed that fungible cryptocurrencies “neither create nor represent the necessary cognizable legal relationship between” a legal entity and the holder that is the “hallmark of a security.”

Related: Banking groups ask SEC to drop cybersecurity incident disclosure rule

SEC’s “new paradigm”

Ripple also referenced SEC Commissioner Hester Peirce’s May 19 “new paradigm” speech. She said she’d been voicing her dissent with the regulator’s approach to crypto, adding:

“Having emerged from the crypto dissent years, I am glad to be able speak to you today as the head of the Commission’s Crypto Task Force about a rational and coherent path forward and a new paradigm at the SEC.”

Peirce said that the SEC’s “approach to crypto in recent years has evaded sound regulatory practice and must be corrected.” She also said that most cryptocurrencies are not securities, adding:

“Most currently existing crypto assets in the market are not [securities]. My supplemental answer is that economic realities matter and non-security crypto assets may be distributed as part of an investment contract, which is a type of security.”

Ripple’s long fight with the SEC

The SEC had viewed a large portion of digital assets as securities, with the regulator’s former chair, Gary Gensler, stating in 2023 that most of the crypto market falls under the securities bracket. This stance led to a protracted legal battle between the SEC and Ripple.

The lawsuit first began at the end of 2020, when the SEC took action against Ripple and its executives, claiming that XRP sales constituted unregistered security offerings. Still, after the government’s stance on crypto changed with the election of current US President Donald Trump, Ripple has mostly won the battle, with the SEC recently dropping its appeal against a ruling favorable to the company.

In its recent letter to the SEC, Ripple also cited a ruling in the case noting that “the court held that certain of Ripple’s historical institutional sales of XRP were investment contracts,” while the secondary sales were not. Furthermore, the judge “determined that XRP itself is not a security.”

Magazine: XRP win leaves Ripple and industry with no crypto legal precedent set

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House Republicans to probe Gary Gensler’s deleted texts

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House Republicans to probe Gary Gensler’s deleted texts

House Republicans to probe Gary Gensler’s deleted texts

A group of House Republicans said they’re engaging with the SEC’s Office of Inspector General to find out more about former SEC Chair Gary Gensler’s deleted text messages.

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SEC staff open to advisers using trust companies as crypto custodians

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SEC staff open to advisers using trust companies as crypto custodians

SEC staff open to advisers using trust companies as crypto custodians

The SEC’s Division of Investment Management said it wouldn’t recommend that the agency take action against advisers who use a state trust company as a crypto custodian.

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Sir Keir Starmer says he will take ‘no more lectures’ from Nigel Farage – and warns of ‘fight for the soul of our country’

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Sir Keir Starmer says he will take 'no more lectures' from Nigel Farage - and warns of 'fight for the soul of our country'

Sir Keir Starmer has said he will take “no more lectures” from Nigel Farage, as he warned that the next four years will be “a fight for the soul of our country” against Reform UK.

In a speech setting out his vision of “national renewal” for Britain, the prime minister hit out at “snake oil merchants on the right, on the left”, and questioned whether Mr Farage and his party “genuinely love our country”.

Sir Keir also asked for “patience” as he implements the “change” he has promised, which comes after a challenging first 14 months in power, with Reform UK continuing to top the opinion polls, and dissent within his own party in the form of a series of interviews by Greater Manchester mayor Andy Burnham criticising the direction of the government.

In an hour-long speech at the Labour Party conference, the prime minister declared that the UK is at “a fork in the road”, saying: “We can choose decency, or we can choose division; renewal or decline; a country proud of its values, in control of its future, or one that succumbs against the grain of our history to the politics of grievance. It is a test, a fight for the soul of our country.”

Sir Keir argued the “path of renewal” he wants to set the country on is “long”, and “requires decisions that are not cost-free or easy, decisions that will not always be comfortable for our party”. But the reward, he said, is “a new country, a fairer country, a land of dignity and respect”.

Analysis: Speech a success for PM – but biggest issue in UK politics ignored

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How did the PM perform at conference?

He hit out at politicians who “tell you there’s a quick fix, a miracle cure, tax cuts that magically pay for themselves, a wealth tax that somehow solves every problem”.

“We can all see these snake oil merchants on the right, on the left, but be in no doubt, none of them have any interest in national renewal because decline is good for their business,” the prime minister said.

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‘That’s not pride, that’s racism’

Starmer calls on party to ‘fight Reform’

In a lengthy attack directly on Reform UK, Sir Keir said: “Think about it, when was the last time that you heard Nigel Farage say anything positive about Britain’s future? He can’t. He doesn’t like Britain, doesn’t believe in Britain, wants you to doubt it just as much as he does. So he resorts to grievance.”

He continued: “The question I ask seriously of Nigel Farage and Reform is, do they love our country? Do they want to serve our country? All of it – our beautiful, tolerant, diverse country, every region, nation and city? Or do they just want to stir the pot of division?”

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YouGov: Farage set to be next PM

He issued a rallying cry to the Labour Party to “fight Reform with everything that this movement has”.

He went on: “If you are a patriot, whether you vote Labour or not, if you want to stand against grievance and renew Britain, then this is your fight too. Because even in a world this dangerous, I do think the politics of grievance is the biggest threat we face because it attacks who we are.”

The prime minister added that he will “fight with every breath I have, fight for working people, fight for the tolerant, decent, respectful Britain that I know”.

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Cabinet reacts to Starmer speech

Starmer is ‘unfit to be PM’

In response, Mr Farage said in a video message online: “I used to think the prime minister was a decent man, somebody that I could talk to and chat to. We might disagree on worldview, but I thought he was a profoundly decent human being.

“I am completely shocked at his behaviour. I hope when he wakes up tomorrow morning, he feels ashamed of what he has done.

“This is a desperate last throw of the dice for the prime minister, who’s in deep trouble. A prime minister who can’t even command the support of half of his own party. But I’m sorry to say, I now believe he is unfit to be the prime minister of our country.”

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Farage hits back at Starmer

The Conservative Party barely got a mention in the hour-long speech, underscoring where Sir Keir believes the battle lines will be drawn at the next general election, expected in 2029.

But speaking to broadcasters afterwards, party leader Kemi Badenoch said: “I just thought it was really extraordinary that Keir Starmer could not explain how he was going to improve the economy.”

She described the fight between Sir Keir and Mr Farage as “two boys squabbling in the playground”, and said she wants to focus on how “the people in government can make life better”.

Read more:
Farage on course to be next PM, mega poll projects
Almost two in three Labour members back Burnham over Starmer
Streeting says Labour ‘need Angela Rayner back’

PM sets out the ‘purpose’ of his government

As he declared Reform UK “the enemy of national renewal”, Sir Keir set out his vision of the future of the country, saying: “At the end of this hard road, there will be a new country, a fairer country, a land of dignity and respect. Everyone seen. Everyone valued.

“Wealth creation in every single community. Working people in control of their public services. The mindless bureaucracy that chokes enterprise removed, so we can build and keep building. Clean British energy powering our homes. Technology harnessed to drive us forward. Our flags flying proudly as we celebrate difference and oppose racism.”

He acknowledged that the public is “losing faith”, and people are feeling “ground down”, saying: “Politics has made them question Britain. And could you blame them? They’ve been nothing but patient.”

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Was that a campaign speech?

The prime minister said Britain is not “broken” – something he has previously argued himself – but said that his solution to the problems Britain faces is an economy working “from the grassroots”, secure borders and controlled migration, and public and private investment in everything from education to infrastructure.

“Every decision” the government has made in the past 14 months has been about “changing the way we create wealth, reforming public services, giving people more control over our future”, he argued.

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The prime minister announced “NHS Online”, which will allow patients to access prescriptions, book scans and tests, receive clinical advice, and manage appointments through the NHS app.

And he also announced he is scrapping the Blair-era target of 50% of all young people going to university, in favour of two-thirds going to either universities or “gold-standard apprenticeships”.

Concluding his speech, the prime minister said: “People say that a nation like ours can’t be a community – that it is too diverse, too divided. I reject that. That goes against everything I stand for, everything I’ve served, everything I understand about this great country that I love.

“So no matter how many times people tell me it can’t be done, I believe Britain can come together, that we can pursue a shared destination, that we can unite around the common good. That is my ambition.

“The purpose of this government – end decline, reform our public services, grow our economy from the grassroots and with resolve, with respect, with a flag in our hands, we will renew this country until we can say with total conviction that Britain is built for all.”

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