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'Huge': SEC Emails Suggest XRP Is Not Security

Sun, 05/21/2023 - 09:07
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Alex Dovbnya
New evidence suggests that Ripple's XRP token may not be classified as security, according to SEC's recently unearthed internal emails
'Huge': SEC Emails Suggest XRP Is Not Security
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Evidence of internal emails from the U.S. Securities and Exchange Commission (SEC) suggests that there are reasonable grounds to believe that XRP, the controversial cryptocurrency associated with blockchain company Ripple, does not meet all elements of the Howey Test, and thus, might not be classified as a security.

The information was unearthed by John Deaton, a popular legal commentator, who highlighted references to the SEC emails in the footnotes of Ripple's opposition and reply briefs.

Deaton expressed confusion as to why the potential implication of these emails was not given more prominence by Ripple's legal team.

The emails, cited as Exhibit 220, appear to argue that there are reasonable grounds to consider that XRP does not satisfy all Howey factors, a test used to determine whether certain transactions qualify as investment contracts.

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This came as a surprise revelation to Deaton, who admitted he had initially overlooked the detail in the footnotes despite having gone through thousands of pages of legal documents related to the case.

It seems that the vital detail was missed because of the placement of the email citation in relation to a sentence discussing analyses sent to the SEC by independent market participants. The analyses concluded that XRP was not a security, drawing attention away from the email citation that immediately followed.

Deaton also posed an intriguing question about why Ripple's lawyers did not make a bigger deal about this information if it was a statement from a senior SEC staff member. He speculated that the quote might not be a direct statement from an SEC official, but rather an SEC official referencing another person's analysis of XRP in the emails with Hinman, a former SEC official.

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at