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Ripple CLO Stuart Alderoty has broken his silence on the latest categorization of meme coins by the United States Securities and Exchange Commission (SEC). The legal expert agreed wholly with the market regulator, emphasizing that meme coins are not securities. He reiterated that the beauty of the guidance is linked to its simplicity.
Non-security case for meme coins
According to the Ripple CLO, the question for the market regulator is whether or not something falls under its jurisdiction, not whether it is legal or illegal. He noted that with the commission’s new position, if fraud occurs, other agencies can act, not the SEC.
Alex DovbnyaAlderoty said the SEC’s guidance sticks to law and precedent. He noted that it avoided any vague categorizations like "decentralization."
In supporting the position, the Ripple CLO said meme coins are not securities because they do not "confer rights to income, profits, or assets." Rather, he pointed out that their value comes from market sentiment, not managerial efforts.
Just as Ripple Labs has argued in its lawsuit with the U.S. SEC, Alderoty said if there is no investment in a common enterprise, then there is no investment contract. He ended his submissions by saying the understanding of crypto securities terms does not have to be complicated.
Right crypto policy changes are here
Since Mark Uyeda became the acting chairman of the U.S. SEC, positive regulatory changes have started sweeping the crypto industry. This guidance about meme coins marks a key reflection of these changes.
Godfrey BenjaminOver the past week, the regulator has closed investigations and lawsuits into some of the top crypto cases it picked up during the Gary Gensler-led administration. One of the latest is the lawsuit with Coinbase, which was officially dropped on Feb. 27.
With the changes and positive trends, many industry experts have predicted that the Ripple lawsuit may also be dismissed by the U.S. SEC, even though it is at the appeal stage.
Dan Burgin
Vladislav Sopov