Blockchain Association Asks Court Approval to Defend Ripple in SEC Case

Notably, late in 2020, the SEC filed a lawsuit against Ripple on the grounds that it had offered XRP as unlicensed securities. The parties recently submitted their applications for a preliminary injunction through a series of jurisdictional grounds. The Blockchain Association requested authorization from the court hearing the case on Friday, along with the real amicus brief.

Blockchain Association Amicus Curiae Brief

If accepted, the court would consider the group's claims in the supporting amicus curiae brief before considering a summary ruling. Briefs of this nature can provide background information and analysis of the facts presented, but they cannot add new information or evidence to the record.

The request for permission stated that the excessively vast interpretation of the securities laws by the SEC would have catastrophic consequences on the business and outside the sector. According to a memorandum of law in defense of the motion, the brief of the request for leave discusses other uses of crypto tokens in the market, not simply Ripple.

Assertions in Brief

The brief asserts that the SEC "illegally" examined secondary sales as evidence that the corporation was breaking federal securities regulations and urged the court to consider a token's unique purpose.

The lawsuit continued by stating that many tokens are utilized in secondary trading activity and do not adhere to the various criteria laid forth in the Howey Test, a Supreme Court decision frequently cited as a precedent for determining whether an asset qualifies as a security.

Primary Focus of Brief

The brief devotes a major fraction of its attention to the issue of how widely securities regulations pertain to tokens outside the early sales. The proposal from the Blockchain Association joins those made by several other organizations, along with a group of XRP investors and SpendTheBits Inc., a payments platform that focuses on XRP.