Ripple submits SEC recommendations urging clear rules after $150 million legal battle

Ripple filed a comment letter with the US Securities and Exchange Commission on October 20, 2026, advocating for finalized rules governing crypto assets. The company argued that current federal securities laws lack precise definitions of what constitutes a security, creating regulatory ambiguity. Under Ripple's proposal, investment contracts should qualify as securities rather than the underlying tokens themselves, potentially clarifying the status of assets once contractual agreements conclude.

The firm pointed out that inconsistent enforcement has pushed industry innovation offshore, noting it has spent more than $150 million to clarify legal questions in court. Ripple contends that a defined framework is essential to establish long-term certainty across the sector.

The regulatory framework under consideration proposes two fundraising tiers for crypto startups seeking to raise more than the $5 million startup exemption allows. Tier 1 would permit annual capital raises of up to $20 million, while Tier 2 would allow up to $75 million. Both tiers would require SEC approval and comprehensive disclosures covering tokenomics, governance, and development risks. Tier 2 issuers would also need to provide audited financial statements, introducing higher compliance costs that could present challenges for smaller projects and non-US entities.