Ripple Lawsuit: SEC Fails to Prove XRP as Security, Says Web3 Lawyer

Last Updated: 12 April 2023

Jeremy Hogan, a partner at Hogan & Hogan, has argued that the US Securities and Exchange Commission (SEC) has failed to prove that XRP is a security. He believes that the Commission has not established an “implied and explicit investment contract” between Ripple and its customers.

SEC vs Ripple

The SEC filed a case against Ripple and two of its executives in 2020 for issuing unregistered securities worth over $1.3 billion. Both parties have been embroiled in a legal battle since then, with Ripple claiming that XRP is not a security as it doesn’t meet the requirements of the Howey Test.

The Definition of an Investment Contract

According to Hogan, the SEC has only attempted to prove a purchase agreement between the parties, which is different from an investment contract as there is no obligation on the vendor. He stated that a simple purchase cannot be an “investment contract” and that there must be an obligation for Ripple to do something other than transfer the asset.

Hogan further argued that there cannot be a “reasonable reliance” on an offeror to make a profit when there is zero legal recourse if the offeror fails to come through.

Tension and Criticism

Since the SEC filed the case against Ripple, there has been increased pressure on the sector. This year, SEC Chairman Gary Gensler stated that Ethereum (ETH) could be viewed as a security along with other proof-of-stake assets because staking can be seen as an investment in anticipation of profit.

The digital asset ecosystem has criticized the SEC’s approach, describing it as “harsh and stifling the industry’s growth.” The XRP Army has been vocal in their criticism, blaming the prolonged case with the SEC for the woes of XRP in the market. On the other hand, several investors hail the SEC for its efforts to curb scams in the sector.


As the SEC vs Ripple case nears its end, industry experts continue to weigh in on the developments so far. Hogan’s arguments add to the ongoing debate over whether XRP should be considered a security or not. The outcome of the case could have far-reaching consequences for the wider digital asset industry.

Investors in the digital asset industry are watching the SEC vs Ripple case with great interest as the outcome could have significant implications for their investments. Whether XRP is classified as a security or not could impact investor sentiment and the regulatory landscape for digital assets. To stay updated on the latest news and trends in the digital asset industry, investors can turn to popular trading platforms like Bitcoin Revival or Bitcode Prime.

  • Steven Gray

    Steven Gray is a journalist with a heart for crypto. He filters the wide range of news and ensures that it reaches the public in a comprehensible way. He often does this with the support of technical analysis.

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