- SEC has intensified its appeal in the Ripple lawsuit, which could redefine U.S. cryptocurrency regulation.
- XRP recorded weekly gains even with a recent short-term dip amid ongoing SEC legal uncertainties.
In the midst of the ongoing legal dispute involving Ripple [XRP] Labs and the U.S. Securities and Exchange Commission (SEC), the SEC is pushing ahead with its appeal process.
On October 17th, the agency submitted a ‘Civil Appeal Pre-Argument Statement’ (Form C), indicating its intention to contest a prior court ruling in the matter.
This development is crucial in the high-stakes legal battle, as the outcome of the appeal may redefine the limits of SEC’s authority over the cryptocurrency sector.
What’s the background?
For those who may not know, on October 2nd, the SEC took a major step by filing a notice of appeal in the Ripple lawsuit, seeking to reverse a decision made by Judge Analisa Torres.
However, on October 16th, it was disclosed that the SEC had failed to meet the deadline for submitting their Form C, leading to significant speculation.
As anticipated, many within the crypto community are discussing whether this delay hints at a potential private settlement with Ripple or if it was merely an oversight on Gary Gensler’s team’s part.
When the SEC initiated its lawsuit against Ripple and two of its executives in 2020, Ripple made it clear that this legal fight was not just about their company. Instead, they framed it as a defense for the entire cryptocurrency sector.
Ripple argued that this case indicated the SEC’s broader strategy to target additional entities within the sector.
Now, nearly four years later, as the case moves to the Second Circuit Court of Appeals, its significance is only increasing.
Thus, the outcome could establish a pivotal precedent, influencing how securities laws apply to token issuers, especially in the vital financial jurisdiction of the Southern District of New York.
Remarks from Ripple’s CLO
Commenting on the SEC’s recent action, Ripple Labs’ Chief Legal Officer, Stuart Alderoty, shared his thoughts on X (formerly Twitter), stating,
“No surprises here — once again it’s been emphasized. The Court’s ruling that ‘XRP is not a security’ is NOT under appeal. That judgment remains as the law of the land. Stay tuned for Ripple’s Form C to be submitted next week.”
Indeed, following the SEC’s earlier appeal, Alderoty expressed his disappointment previously when he mentioned,
“The SEC lost on all significant points—that’s why they appealed. Today, Ripple filed a cross-appeal to ensure nothing is overlooked, including the assertion that there cannot be an ‘investment contract’ without essential rights and obligations inherent in a contract.”
XRP Price Effect
In light of these legal updates, XRP seems to be encountering some short-term difficulties. The coin was trading at $0.5499 at the time of writing, reflecting a 0.99% dip in the last 24 hours according to CoinMarketCap.
Nevertheless, despite this marginal decrease, the overall outlook for the token appears optimistic, with XRP registering a 2.56% increase over the previous week.
This positive trend in weekly performance indicates that despite the ongoing regulatory challenges, investor confidence in XRP’s long-term potential may still remain robust.
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