Crypto Industry Secures Early Victory in Legal Battle With Regulators

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The cryptocurrency industry secured an early victory in its court battle with U.S. regulators when a federal judge ruled on Thursday that the sale on public exchanges of a digital asset called XRP complied with securities laws. For years, the Securities and Exchange Commission has argued that digital assets constitute securities, like stocks and bonds traded on Wall Street, and should be subject to the same strict regulations. Last month, the S.E.C. sued two of the largest crypto exchanges, Coinbase and Binance, accusing them of marketing unregistered securities to the public. But the ruling on Thursday in a case involving the crypto company Ripple may complicate that argument and provide fodder for the crypto industry to defend itself in court. The S.E.C. sued Ripple in December 2020, accusing the firm of violating securities laws in one of the first major legal fights involving cryptocurrencies. In the 34-page ruling on Thursday, Judge Analisa Torres of the U.S. District Court for the Southern District of New York said that Ripple did not break the law when the cryptocurrency it created, XRP, was sold on public exchanges.