In the statements made, the US Department of Justice (DoJ) used the phrase “commodity” for the two altcoins.
Altcoin displayed as commodity
As the legal battle between Ripple Labs and the US Securities and Exchange Commission (SEC) is about to end and all eyes are on Judge Analisa Torres, the US Department of Justice is reported to have presented another argument for Brad Garlinghouse and his company.
In the US Department of Justice’s recent court filings against Avraham Eisenberg, the DoJ mentions two cryptocurrencies as commodities. Eisenberg, who exploited DeFi platform Mango Markets and earned $67 million, was arrested yesterday in Puerto Rico. Eisenberg was subsequently accused of manipulating the market.
Are altcoins securities?
For XRP investors and Ripple Labs, the indictment is interesting in that the US Department of Justice names the two cryptocurrencies as CRV and MNGO commodities rather than securities. At no point do Justice Department lawyers refer to cryptocurrencies as securities. They also don’t talk about securities law violations. For Ripple, the DoJ may have presented another argument that the legal situation for cryptocurrencies is not as clear as the SEC has always claimed. Both CRV and MNGO are defined as commodities. It is therefore at least reasonable to assume that XRP is a commodity, not a security.
For the Ministry of Justice, there appears to be no disagreement that any token should be classified as a security. This stands in stark contrast to SEC Chairman Gary Gensler, who led the case against Ripple and considers every cryptocurrency a security. In the indictment, the Ministry of Justice explicitly writes CRV and MNGO tokens as commodities. Remarkably, these documents were filed in the same court where the case between Ripple and the SEC was held. It is stated in the indictment as follows:
“Defendant AVRAHAM EISENBEG willfully and knowingly, directly and indirectly, manipulatively violated section 180.1 of chapter 17 of the Code of Federal Regulations, subject to the rules of a legal entity registered under a barter and commodity sale agreement”
Will the Ripple case be affected by this event?
After the announcement, it was questioned whether the statements in the indictment would affect the lawsuit that has been going on for 2 years between Ripple and SEC. As it is known, the SEC generally considers all tokens other than Bitcoin and Ethereum as securities. There is even a serious discussion on Ethereum. Therefore, it is also said that the only asset that is a commodity may be Bitcoin.
As we stated as Kriptokoin.com, the Ripple side never accepts the title of security. If the SEC wins the lawsuit, which is expected to be completed shortly, XRP will also be a security. Contrary to expectations, however, if Ripple company wins the lawsuit, the views of SEC chairman Gary Gensler will collapse completely.