Securities and Exchange Commission v. Ripple—a current case regarding the legal status of cryptocurrency—could be taken to the Second Circuit Court of Appeals (if not the Supreme Court) and set a precedent for the amount of jurisdiction that the U.S. Securities and Exchange Commission (SEC) holds over future cryptocurrency transactions. [1] Because this case could designate a new legal “guardian” for cryptocurrency, it has generated significant interest within the cryptocurrency community. [2] However, an evaluation of cryptocurrency against the standards established in the 1946 Supreme Court case Securities and Exchange Commission v. W. J. Howey Co. points to an ambiguous legal future for cryptocurrency. XRP, the cryptocurrency at issue in Ripple, appears more likely to satisfy the Howey test due to the centrality in its distribution and its exhibition of vertical and horizontal commonality. Thus, despite the furor regarding this case, the final decision in Ripple may not constitute a conclusive legal determination for all cryptocurrencies.

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