Key Takeaways
- • Ripple backed the SEC's proposed Regulation Crypto Assets in a 20-page comment letter filed October 20, 2026, urging the agency to separate the token from the investment contract used to sell it.
- • Ripple's Chief Legal Officer Stuart Alderoty said the firm's legal fight over XRP cost more than $150 million and argued that case-by-case enforcement had pushed innovation abroad.
- • Ripple proposes assessing the end of an investment contract based on an issuer's stated commitments rather than a standalone decentralization test, and wants exchanges and brokers to rely on a properly filed Form TR.
- • Chainlink, Cardano, Hedera, Stellar, Aptos and Avalanche jointly urged the SEC to codify its digital commodity framework, while the Blockchain Association asked to raise the startup exemption from $5 million to $10 million.
- • The formal comment period closed October 20, 2026, but the SEC said it will continue accepting public comments after the deadline.
Summary
Ripple has endorsed the SEC's proposed Regulation Crypto Assets, according to The Cryptonomist, while asking the agency to refine several elements of the framework. The company filed a 20-page comment letter on October 20, 2026. Ripple said it has spent more than $150 million pursuing legal clarity over XRP, a cost that Chief Legal Officer Stuart Alderoty tied to enforcement carried out "case by case, coin by coin," which he argued had driven innovation abroad.
Rather than treating the underlying crypto asset as a security, Ripple favors applying the Howey test to the investment arrangement itself. Its letter asks the SEC to determine when an investment contract ends based on an issuer's commitments. Under the proposal, an investment contract would terminate once an issuer completes or indefinitely halts the core managerial duties it pledged to investors, provided no further such commitments are made. Alderoty said, "What matters is what an issuer actually promised and when those promises end, not a subjective decentralization test." Ripple also wants exchanges and brokers to be able to rely on a properly filed Form TR, which documents that essential managerial activities have ended, along with consistent treatment across federal securities statutes and clarification of secondary-market transactions under Rule 500. The firm is also seeking exemptions from full securities registration for certain crypto offerings.
Ripple's filing comes alongside advocacy from other industry participants. Chainlink, Cardano, Hedera, Stellar, Aptos and Avalanche jointly urged the SEC to codify its digital commodity framework. Chainlink's head of policy, Taylor Barr, said, "Builders need lasting certainty. Codifying this progress would be a meaningful step toward keeping America the home of digital asset innovation." The Blockchain Association separately asked the SEC to raise the proposed startup fundraising exemption from $5 million to $10 million.
Under the proposed rule, qualifying U.S.-based issuers could raise up to $5 million over four years through one exemption route, or up to $75 million within 12 months through a second route subject to additional disclosure and financial reporting obligations. Neither exemption is in force. The proposal also includes a safe harbor for determining when a crypto asset is no longer associated with an investment contract. The formal comment period ended October 20, 2026, though the SEC said it will continue accepting public comments after the deadline.
Rather than treating the underlying crypto asset as a security, Ripple favors applying the Howey test to the investment arrangement itself. Its letter asks the SEC to determine when an investment contract ends based on an issuer's commitments. Under the proposal, an investment contract would terminate once an issuer completes or indefinitely halts the core managerial duties it pledged to investors, provided no further such commitments are made. Alderoty said, "What matters is what an issuer actually promised and when those promises end, not a subjective decentralization test." Ripple also wants exchanges and brokers to be able to rely on a properly filed Form TR, which documents that essential managerial activities have ended, along with consistent treatment across federal securities statutes and clarification of secondary-market transactions under Rule 500. The firm is also seeking exemptions from full securities registration for certain crypto offerings.
Ripple's filing comes alongside advocacy from other industry participants. Chainlink, Cardano, Hedera, Stellar, Aptos and Avalanche jointly urged the SEC to codify its digital commodity framework. Chainlink's head of policy, Taylor Barr, said, "Builders need lasting certainty. Codifying this progress would be a meaningful step toward keeping America the home of digital asset innovation." The Blockchain Association separately asked the SEC to raise the proposed startup fundraising exemption from $5 million to $10 million.
Under the proposed rule, qualifying U.S.-based issuers could raise up to $5 million over four years through one exemption route, or up to $75 million within 12 months through a second route subject to additional disclosure and financial reporting obligations. Neither exemption is in force. The proposal also includes a safe harbor for determining when a crypto asset is no longer associated with an investment contract. The formal comment period ended October 20, 2026, though the SEC said it will continue accepting public comments after the deadline.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.