Ripple Resolute As SEC Does Not Appeal Verdict: XRP Is Not A Security, Focuses On Exchange Sales

Ripple has emerged resolute following the U.S. Securities and Exchange Commission's (SEC) decision not to appeal a significant ruling that determined XRP is not a security. Instead, the SEC is focusing its efforts on challenging specific aspects of the case, particularly regarding exchange sales and the actions of Ripple executives.

Key Takeaways

• The SEC has chosen not to appeal the ruling that XRP is not a security.
• The focus of the SEC's appeal is on Ripple's programmatic sales of XRP and actions of its executives.
• Ripple plans to file a cross-appeal in response to the SEC's actions.

Background Of The Case

In a landmark decision last year, Judge Analisa Torres ruled in favor of Ripple, stating that the company's sales of XRP to retail investors on digital asset exchanges did not violate U.S. securities laws. However, the court found that sales to institutional investors did breach these regulations. This ruling has been pivotal in shaping the regulatory landscape for cryptocurrencies.

SEC's Appeal Details

On October 17, the SEC submitted a Civil Appeal Pre-argument statement to the U.S. Court of Appeals for the Second Circuit, outlining its intent to contest certain elements of the previous ruling. Notably, the SEC is not disputing the court's decision regarding retail sales but is focusing on:

1. Programmatic Sales: The SEC aims to challenge Ripple's programmatic sales of XRP on digital trading platforms.
2. Executive Actions: The agency intends to pursue Ripple executives Brad Garlinghouse and Chris Larsen, accusing them of aiding and abetting XRP sales on these platforms.
3. Legal Review: The SEC has requested that the appellate court review these issues “de novo,” meaning without deference to the trial court's judgment.

Ripple's Response

Ripple's Chief Legal Officer, Stuart Alderoty, expressed confidence in the ruling, emphasizing that the determination that XRP is not a security remains unchallenged. He stated, "No surprises here — once again it’s been made clear. The Court’s ruling that 'XRP is not a security' is NOT being appealed. That decision stands as the law of the land."

Ripple is also preparing to submit its cross-appeal next week, indicating that the legal battle is far from over.

Community Reactions

The SEC's decision to appeal has sparked significant discussion within the cryptocurrency community. Many observers are speculating about the implications of the SEC's focus on exchange sales and the potential impact on Ripple's operations and the broader crypto market. The timing of the SEC's filing, just weeks after it signaled its intent to challenge the ruling, has also raised eyebrows.

Conclusion

As the legal tussle between Ripple and the SEC continues, the outcome of the appeal could have far-reaching implications for the cryptocurrency industry. With Ripple standing firm on the ruling that XRP is not a security, the next steps in this ongoing saga will be closely watched by investors, regulators, and industry stakeholders alike.

Sources

• Ripple resolute as SEC does not appeal verdict XRP is not a security, focuses on exchange sales, CryptoSlate.