In a series of tweets on Sunday, John Deaton, a prominent blockchain lawyer known for his support of Ripple, argued that there are no legal precedents for determining whether a crypto sale constitutes an investment contract. This argument was made in the context of the ongoing case between Ripple and the U.S. Securities and Exchange Commission (SEC), in which the SEC alleges that Ripple’s XRP token is a security.

Deaton’s main point is that no investment contract cases in the last 76 years have held the underlying asset itself to be a security. He arrived at this conclusion after conducting extensive research on the subject and drawing on the work of other experts like Lewis Cohen, a New York-based lawyer who recently published a book on the topic.

Cohen’s book, titled “The Ineluctable Modality of Security Law: Why Fungible Crypto Assets Are Not Securities,” argues that crypto assets like XRP are not securities because they are fungible and do not meet the criteria for being an investment contract under the Howey Test, which is used to determine whether a particular transaction constitutes an investment contract.

Deaton’s tweets sparked a debate among legal experts and members of the crypto community about the nature of crypto assets and how they should be regulated. Some argue that crypto assets like XRP are indeed securities and should be subject to the same regulations as traditional securities, while others contend that they are a new asset class that requires a different regulatory framework.

Regardless of the outcome of the Ripple-SEC case, it is clear that the regulation of crypto assets is a complex and evolving area of the law that will require careful consideration by regulators, lawmakers, and legal experts in the years to come.

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However, there are others who disagree with this perspective, arguing that crypto assets like XRP are indeed securities and should be subject to the same regulations as traditional securities. The outcome of the Ripple-SEC case could have significant implications for the regulation of the wider crypto industry, and it is clear that this is a complex and evolving area of the law that will require careful consideration by regulators, lawmakers, and legal experts in the years to come.

Regardless of the final outcome, it is clear that the development of blockchain technology and the rise of cryptocurrencies like XRP have created a need for new regulatory frameworks and legal precedents. As this technology continues to evolve, it is important for regulators and legal experts to stay up-to-date with the latest developments and work together to ensure that crypto assets are properly regulated and protected.

In conclusion, the ongoing case between Ripple and the SEC has sparked a heated debate about the nature of crypto assets and how they should be regulated. John Deaton, a pro-Ripple blockchain lawyer, argues that there are no legal precedents for determining whether a crypto sale constitutes an investment contract, and that no investment contract cases in the last 76 years have held the underlying asset itself to be a security.