Ripple Seeks Clearer SEC Rules for Crypto Tokens

Ripple is urging the SEC to clarify when crypto tokens are no longer linked to securities investment contracts. In an October 20 comment letter supporting the SEC’s Regulation Crypto Assets proposal, Ripple recommended changes to proposed Rules 400 and 500. It says an investment contract should end when an issuer’s commitments expire, are abandoned or otherwise terminate—not only when promised managerial efforts stop. Ripple also argues that decentralisation should not be a separate legal test and that a token should not automatically be treated as a security because it was sold through an investment contract. Ripple wants Form TR filings to remain optional, with no presumption that a token remains linked to an investment contract if an issuer does not file. It also seeks protection for exchanges, brokers and dealers that rely in good faith on public filings, and consistent treatment of tokens separated from investment contracts under federal securities laws. The proposals follow Ripple’s costly SEC litigation, which the company said cost more than $150 million and ended in 2025 after both sides dismissed their appeals. The SEC proposal includes potential offering exemptions of up to $5 million over four years or $75 million over 12 months, subject to disclosure and investor protections. The comment period has closed, but the proposal is not in force and the SEC may revise it before adopting a final rule. Ripple’s recommendations could influence future token classification and U.S. crypto trading rules, but they do not immediately change XRP’s legal status or market rules.