Ripple’s legal battle with the Securities and Exchange Commission (SEC) continues to unfold, with a recent prediction from pro-XRP lawyer John E. Deaton shedding more light on the SEC’s appeal move in the Ripple vs SEC lawsuit. Many industry experts believe that the SEC is fighting a battle that has already been won.
Deaton made his prediction during the onXDC Live blockchain industry conference in Texas. He stated that the court will reject the motion put forward by the SEC. If this prediction proves true, the SEC will be required to wait until the end of next year before filing a full appeal in the Second Circuit.
To clarify certain misconceptions surrounding the Ripple vs. SEC case, Deaton affirmed that there is currently no appeal as the federal judge only permitted the SEC to request an appeal for an interlocutory appeal. He believes that Judge Analisa Torres only approved the request to establish that the ruling is based on evidence and is perfect.
The SEC expressed dissent with Judge Torres’ ruling on XRP, announcing its intention to appeal the verdict. The ruling stated that programmatic offers and XRP sales by Ripple and its executives Brad Garlinghouse and Chris Larsen on trading platforms do not violate securities laws, as they do not lead investors to expect profits from the efforts of others. The SEC believes this decision should be re-examined by an appellate court.
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Another argument that the SEC intends to contest is that Ripple’s distribution of the token as payment for services was not sufficient to be recognized as an investment of money.
In response to the SEC’s intent to appeal, the regulator sent a letter to Judge Torres requesting that she freeze the case during the appeal. The SEC cited concerns over multiple pending court cases against crypto firms, such as Binance and Coinbase, which could be impacted by the outcome of this appeal.
Judge Torres granted the SEC’s request to file a motion for an interlocutory appeal, giving the regulator one week to file the motion. Ripple was then given until September 1 to respond, with the SEC given a reply window until September 8th. Some netizens speculated that the SEC’s argument in the motion was accepted by the Judge, but this sentiment is not shared by Deaton and other industry players.
Bill Hughes, ConsenSys Senior Counsel, highlighted the challenging position the SEC has found itself in. He did not believe that Judge Torres would be convinced by the SEC’s inconsistent arguments. Even with the judge granting the SEC leave to file a motion for leave to appeal, Hughes pointed out that the SEC would face the uphill task of gaining the Second Circuit’s approval for the appeal.
The outcome of the SEC’s appeal will have significant implications for the Ripple vs. SEC case and potentially for the broader crypto industry. The ruling on whether XRP is a security could set a precedent for how other cryptocurrencies are regulated in the United States.
It is important for investors and industry participants to closely follow the developments of this legal battle. The outcome could have a significant impact on the future of Ripple and the regulatory environment for cryptocurrencies in the US.
Disclaimer: This article is not intended to provide financial advice. Readers should conduct their own research before making any investment decisions.
