US Lawyer Argues Crypto Price Gains Alone Should Not Trigger Securities Law

VADODARA, January 27, 2026 — Holding cryptocurrency solely for price appreciation should not subject it to securities laws. A U.S. lawyer made this argument in a submission to the SEC's crypto task force. This latest crypto news challenges the regulatory framework's core assumptions. Market structure suggests a shift in legal interpretation.

Investigation: Legal Challenge to SEC's Crypto Framework

Teresa Goody Guillen, a lawyer specializing in crypto regulation, submitted a public letter on the SEC's website. According to Cointelegraph, she stated that holding a token with simple price expectations constitutes a passive economic interest. Guillen argued this act alone fails to meet securities law criteria. She emphasized cryptocurrencies require flexible evaluation. Multiple factors must be considered.

Guillen referenced Ripple's previous stance. Ripple told the SEC on January 9 that applying securities law based on price hopes alone represents regulatory overreach. This confuses speculation with investor rights. The submission targets the SEC's crypto task force directly. It aims to influence ongoing policy discussions.

Market Context & Historical Precedent

Historically, the SEC has used the Howey Test to classify assets. This test examines investment contracts with profit expectations from others' efforts. Guillen's argument disrupts this application for passive crypto holdings. In contrast, past cases like SEC v. Ripple focused on active promotion and enterprise efforts.

Underlying this trend is growing institutional pressure. Regulatory clarity remains a top barrier for adoption. This legal push mirrors efforts seen in 2021-2023 with ETF approvals. However, current market fear complicates sentiment. The Crypto Fear & Greed Index sits at 29/100. This indicates extreme caution among traders.

Related regulatory developments include Bitwise CIO's analysis of US regulatory confusion and Trading212 facing UK scrutiny over crypto ETNs. , Japan's FSA is seeking public comment on stablecoin reserves, highlighting global regulatory divergence.

Technical Architecture & Price Action

Market structure suggests Bitcoin's price at $87,913 faces critical technical levels. The 200-day moving average provides dynamic support near $85,000. A break below this level could trigger a liquidity grab. Conversely, resistance sits at the $92,000 Fibonacci 0.618 retracement level from the 2025 high.

On-chain data indicates low exchange outflows. This suggests hodler accumulation despite fear. The Relative Strength Index (RSI) reads 45, showing neutral momentum. Volume profile analysis reveals a Fair Value Gap (FVG) between $84,000 and $86,000. This zone may act as a future order block.

Ethereum's post-merge issuance rate remains deflationary. However, regulatory uncertainty weighs on altcoin performance. The SEC's potential stance impacts Layer 1 and DeFi tokens disproportionately. Technicals align with Guillen's legal argument for passive holdings.

By The Numbers

Why It Matters

This legal argument matters for institutional liquidity cycles. Clearer regulations reduce compliance costs. They enable broader ETF and pension fund adoption. According to the official SEC.gov website, the task force seeks public input on crypto assets. Guillen's submission directly engages this process.

Retail market structure benefits from defined rules. Speculation versus investment rights distinction protects passive holders. Historical cycles suggest regulatory clarity precedes bull markets. The 2024-2025 cycle saw ETF approvals drive prices. This legal push could catalyze the next phase.

Expert Commentary

Market analysts highlight the technical nuance. 'Applying securities law to passive holdings misinterprets economic reality,' states the CoinMarketBuzz Intelligence Desk. 'On-chain forensic data confirms most Bitcoin UTXOs remain dormant for years. This behavior aligns with Guillen's argument for passive economic interest.'

Market Outlook & Price Scenarios

Two data-backed technical scenarios emerge. Market structure suggests a consolidation phase. The 12-month institutional outlook hinges on regulatory decisions.

• Bullish Invalidation Level: $92,000. A break above this Fibonacci resistance confirms trend reversal. It signals institutional confidence post-regulatory clarity.
• Bearish Invalidation Level: $85,000. A break below this support invalidates the current structure. It indicates prolonged fear and regulatory pressure.

The 5-year horizon depends on legal frameworks. Guillen's argument could shift SEC policy toward flexibility. This encourages long-term investment in proof-of-work and proof-of-stake assets. Consequently, market capitalization may expand beyond current projections.