The US Securities and Exchange Commission (SEC) is refusing to back down in its battle with Ripple Labs, formally appealing aspects of a July court ruling that largely favored the blockchain company and its cryptocurrency XRP. I am doing it.
The appeal, filed on October 17, 2024, plunges XRP’s future into further uncertainty and sets the stage for a lengthy legal battle that could last until July 2025.
Despite the judge’s declaration that XRP itself is not a security, the SEC is challenging court decisions regarding certain types of XRP sales. The suit focuses on programmatic sales of XRP on the digital asset platform and distributions to Ripple employees, which it claims constitute an offering of unregistered securities.
what is the problem
The outcome of this appeal will have significant implications for the entire cryptocurrency industry. A ruling in favor of the SEC could significantly change the regulatory landscape, potentially impacting how other digital assets are classified and traded. It could also impede the development of XRP-based exchange traded funds (ETFs) and impact the operations of other crypto companies.
Conversely, Ripple’s victory could further solidify the argument that not all cryptocurrencies are securities, paving the way for further innovation and adoption within the industry.
After peaking in March, XRP’s price trended downward until it spiked in July following a court ruling that it was not a security. The SEC’s appeal will continue uncertainty until at least mid-2025. Source: Brave New Coin XRP Liquid Index
Timeline for resolution
Ripple’s chief legal officer, Stuart Alderroti, confirmed that the company will file a response, including cross-appeal arguments, within a week. Following this, a lengthy briefing process will begin and the SEC will have up to 90 days to file a preliminary brief.
Based on this projected timeline, a final decision from the Court of Appeals is not expected until mid-2025. This prolonged legal battle could leave XRP in limbo and hinder its growth and adoption as investors and developers await regulatory clarity.
Will the SEC’s position weaken?
Some legal experts believe that the SEC’s recent actions weaken its position. In a separate lawsuit against Binance, the SEC acknowledged that its use of the term “crypto security” is controversial and that not all crypto tokens are securities. This admission could undermine the SEC’s claims in the Ripple appeal and other ongoing lawsuits against crypto exchanges.
Ripple remains confident
Despite continuing legal issues, Ripple CEO Brad Garlinghouse hints at potential initial public offering (IPO) for the company, subject to resolution of SEC lawsuit did. This suggests confidence in Ripple’s long-term prospects and ability to navigate the regulatory environment.
The Ripple v. SEC case continues to be a pivotal moment for the crypto industry. The results will have a major impact on the future of digital asset regulation and innovation. All eyes will be on the court as this landmark case enters its next phase.
