Chicago-based digital asset derivatives exchange Bitnomial has sued the U.S. Securities and Exchange Commission (SEC). The lawsuit challenges the SEC’s claim that XRP futures should be classified as “security futures.”
Bitnomial’s XRP Futures Contract Certification
Bitnomial operates under the Commodity Futures Trading Commission (CFTC). In August, it self-certified its XRP U.S. Dollar Futures contract, as reported by Fox Business. This certification came after the SEC vs. Ripple lawsuit, which debated XRP’s status as a security.
The certification allowed Bitnomial to list and trade the XRP futures contract without needing CFTC approval. The SEC, however, intervened. They argued that XRP futures should be classified as “security futures,” meaning the product must comply with both SEC and CFTC regulations.
SEC’s Demands and Bitnomial’s Response
The SEC warned Bitnomial that moving forward with the listing could violate federal securities laws. They demanded that Bitnomial register as a national securities exchange before offering XRP futures.
In response, Bitnomial sued to contest the SEC’s classification of XRP as a security. The exchange argued that XRP futures should not be regulated by the SEC. In its legal filing, Bitnomial stated, “We disagree with the SEC’s view that XRP is an investment contract and therefore a security.”
Luke Hoersten, CEO of Bitnomial, emphasized the importance of this legal challenge. He noted that the exchange’s clean compliance record strengthens its case. Hoersten believes a favorable court ruling could set a crucial precedent for how the U.S. regulates crypto derivatives like XRP futures.
Crypto.com Also Takes Legal Action
Bitnomial isn’t alone in challenging the SEC. Crypto.com, a leading global crypto exchange, also sued the SEC after receiving a Wells notice. This formal warning indicated potential enforcement actions.
Crypto.com accused the SEC of overstepping its authority by classifying most crypto assets as securities. Since 2023, the SEC has ramped up its scrutiny of the crypto industry. They have targeted companies such as Consensys, Uniswap Labs, and OpenSea. Major players like Ripple Labs, Binance, and Coinbase also remain locked in legal disputes with the SEC.
Ripple’s legal battle with the SEC has dragged on for over three years. Recently, Ripple filed an appeal following Judge Analisa Torres’ ruling. The court decided that XRP sales to retail investors did not qualify as securities, while institutional sales did. Ripple was fined $125 million but continues to seek further legal recourse.
The post Bitnomial Sues SEC Over XRP Futures Classification as ‘Security Futures’ appeared first on Cryptonews.
