In a Twitter thread, Hoskinson explained that his position on most Layer 1 protocols is that they are not securities as long as they offer utility. They are decentralized enough to have operators worldwide survive their founders.
He considers Ripple’s XRP a commodity by this definition, saying it passes the Howey test. He added the fact that an XRP Army independent of the Ripple founders is criticizing him is proof that it is a commodity.
However, he disagreed with Ripple’s lawyers’ approach to arguing the case against the SEC.
In his view, it should be based on the fact that it is absurd to apply “securities regulation to something that has millions of independent participants in more than a 100 countries who cannot be controlled by any fiduciary of a single company.”
Hoskinson believes this approach will rely on the case’s merit, and Ripple lawyers would not need to rely on personal attacks of current or former government employees or attack Bitcoin energy use.
This view appears to be in response to the approach of Ripple Lawyers. They have been claiming that former SEC director William Hinman exempted BTC and ETH from securities violation only because Hinman was being paid by firms with a financial interest in ETH.
“Individual corruption has nothing to do with the Howie test… and does not solve the larger issue of cryptocurrencies being forced into a framework that makes no sense.”
Meanwhile, XRP has seen its price surge by 60% in the last 30 days as the possibility of winning the SEC case against it increases. It is currently trading at $0.5184
It recently recorded minor wins after the court ruled that the SEC must provide the documents of a speech by its former director William Hinman to Ripple. The company has hinged its case on the speech, which the SEC has been reluctant to release.
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