The SEC vs Ripple case continues to unfold as both parties present motions that could potentially impact the outcome. The SEC has filed a motion to certify an interlocutory appeal for the summary judgment issued by District Judge Analisa Torres on July 13. Meanwhile, Ripple and its executives argue that the case should not be halted for the appeal and that both should proceed concurrently.
Ripple CTO David Schwartz explained, “There is an exception for unusual cases, and the SEC is arguing that this is one of those unusual cases where an exception should be made and the regular proceedings should stop until the appeal is complete. Ripple is arguing there should be no exception made, and Brad and Chris are arguing that even if the court grants the SEC the right to appeal, the case should continue and the appeal should run in parallel.”
One legal expert, Greg Beuke, believes that the SEC made a significant mistake in filing an interlocutory appeal, regardless of whether the motion is granted or not. Beuke argues that the SEC failed to understand that the previous ruling did not conclude that sales over crypto exchanges cannot be investment contracts. Instead, the SEC should have provided sufficient evidence to support the claim that XRP sales on exchanges constituted investment contracts.
Beuke points out that the SEC did not produce evidence of a single XRP holder who relied on Ripple to increase the price of XRP. The expert testimony presented by the SEC was also excluded. Beuke further argues that even if the appeal motion is approved, the SEC cannot introduce new evidence or make new legal arguments during the appeal hearing. Therefore, the SEC will have limited evidence to support its claims about reasonable retail purchasers.
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The SEC’s main argument is that XRP sales on centralized exchanges constituted investment contracts, and they rely on expert evidence to support this claim. However, the SEC has not responded to John Deaton’s affidavit, which represents over 70,000 XRP holders who stated that they did not expect any investment returns from Ripple’s XRPL developments.
The Ripple and XRP community have expressed frustration with the ongoing case, as it has hindered XRPL growth over the past two years. Additionally, some DeFi developers have chosen to work on other blockchains like Ethereum that were not directly involved in the SEC’s regulatory scrutiny.
It remains to be seen how the court will decide on the motions presented by both parties. If the court grants the SEC’s motion for an interlocutory appeal, it could potentially delay the case and prolong the legal battle. However, if the court decides to continue the case and the appeal concurrently, it would allow for a more expedited resolution.
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