The status of XRP has become a point of contention between the SEC and Ripple, with the SEC claiming it is a security and Ripple arguing it is a token. Attorney Deaton, a supporter of XRP, believes that regardless of how Ripple sold the coin, it should not be considered a security. Concerns have been raised by investors who purchased XRP based on the expertise of Ripple’s board, with some claiming they were unaware of Ripple when they bought XRP. This has sparked reactions within the XRP community, with some expressing concern about their investments. Attorney Deaton suggests that if Ripple had direct involvement with investors and sold XRP to them, the SEC could argue that the Howey test was met, which determines if an investment is a security. However, Deaton clarifies that if the user did not directly purchase XRP from Ripple or bought it for non-investment purposes, the Howey test would not be applicable. Deaton is confident that Judge Analisa Torres will address the issue of XRP’s secondary market transactions in her ruling.
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