July 14, 2023 – The Chamber of Digital Commerce is pleased that there has been a ruling in SEC v. Ripple, applying the legal precedent set forth in the Chamber’s brief. 

This ruling comes after years of litigation, including The Chamber’s amicus brief filed in September 2022. In the amicus brief, The Chamber lays out the applicable legal precedent for initial offerings of digital assets and makes the court aware that no federal law (or regulation) governs the legal characterization of a digital asset recorded on a blockchain.  The Chamber also urges the court to clarify that the law applicable to an investment contract is separate and distinct from the law applicable to the subject of that investment contract. 

“The Court echoed key themes from the Digital Chamber’s amicus brief by unequivocally stating that a digital asset, like other tangible and intangible assets that may be the subject of an investment contract, is separate and apart from the investment contract itself, and does not embody an investment contract. While the Court did not directly render an opinion on secondary resales of digital assets, the opinion provides that certain sales of digital assets may not meet the ‘expectations of profits’ prong of Howey. The Court even cited the Judge’s opinion in SEC v. Telegram where the Digital Chamber played a critical role as amicus curie,” said Lilya Tessler, Partner and head of Sidley Austin LLP’s FinTech and Blockchain group. Lilya Tessler represented the Digital Chamber in filing the amicus brief in SEC v. Ripple and SEC v. Telegram

This ruling is a promising move as the digital asset industry is navigating in a lack of regulatory and legal clarity. Although this decision is a great first step, The Chamber looks forward to working with Congress in developing legislation that will help to reinforce and further define the points made in this ruling. 

 “This case is a big milestone in the process of setting clear and consistent sets of rules for our industry, and we are also encouraged by the legislation also in play,” said Perianne Boring, CEO and Founder of The Chamber of Digital Commerce. “The digital asset industry deserves a level playing field and we will continue to advocate for sound policy that promotes U.S. leadership in the digital economy.” 

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