SEC vs. Ripple: Legal Battle Reaches Pivotal Moment This Week

The SEC faces a January 15 deadline to decide whether to continue its appeal in the Ripple case, impacting crypto regulations.

Gary Gensler keeps flying over with his eagle wings on Brad Garlinghouse case, Brad is not impressed.
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The SEC vs. Ripple legal battle reaches a critical moment this week as the US Securities and Exchange Commission (SEC) approaches a January 15 deadline to file its appeal-related opening brief.

This filing will decide if the SEC continues its challenge to a July 2023 court ruling that public XRP sales do not qualify as securities.

Uncertainties Loom

It remains uncertain whether the SEC will file its opening brief by the January 15 deadline, a typical step in continuing the appeal.

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This uncertainty stems from President-elect Donald Trump’s victory and anticipated changes at the SEC. Trump announced plans to nominate Paul Atkins, a crypto-friendly former SEC commissioner, as the next SEC Chair on December 4, 2024. Atkins is known for advocating reduced regulatory burdens and supporting financial innovation.

Current SEC Chair Gary Gensler is set to leave the agency on January 20.

SEC vs. Ripple Case

The SEC filed a lawsuit against Ripple in December 2020, accusing the companyโ€™s XRP token of being an unregistered security. The SEC vs. Ripple lawsuit centers on former SEC official William Hinman, who played a pivotal role in shaping the SECโ€™s stance on cryptocurrency regulation.

In 2018, Hinman declared that Bitcoin and Ethereum were not securities. However, his ties to the law firm Simpson Thacher, which has connections to Ethereum, raised concerns about potential conflicts of interest. After leaving the SEC, Hinman returned to Simpson Thacher, prompting further scrutiny.

Ripple case documents revealed that the SECโ€™s Ethics Division had warned Hinman about these conflicts, and the agency unsuccessfully attempted to shield his documents under attorney-client privilege. The court rejected these efforts, amplifying concerns about bias in the SECโ€™s actions.

On the Flipside

  • Ripple strengthens its market position with its recent Ripple stablecoin launch, RLUSD.ย 
  • Last week, company President Monica Long also mentioned that an XRP exchange-traded fund (ETF) is likely to follow Bitcoin and Ether ETFs in the U.S.

Why This Matters

The SECโ€™s decision to appeal the Ripple case could further prolong the legal battle, which is already seen as a potentially significant precedent for the cryptocurrency industry, especially in defining what qualifies as a security under US law.

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This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Alex Costa

Alex Costa is a crypto writer and investor specializing in researching, analyzing and reporting on promising small-cap projects that are gaining traction in the industry. He has been in crypto since 2018, when he began looking for hidden gems in crypto. Today, he is dedicated to finding the next top performing NFTs and tokens.

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