The Securities and Exchange Commission (SEC) has until October 7 to decide whether to appeal a pivotal ruling by Judge Analisa Torres regarding XRP in the ongoing Ripple case. As legal experts assess the situation, the consensus suggests that the chances of an appeals court overturning Judge Torres’s decision are low. This assessment is based on the ruling’s reliance on specific factual findings and the absence of expert testimony concerning XRP holders.
If the SEC opts to appeal, the case is likely to return to Judge Torres, who may reaffirm her previous ruling. Legal analyst Fred Rispoli noted that while there’s a hypothetical scenario in which the SEC could win if it randomly selected favorable judges, this outcome is deemed improbable.
Former SEC lawyer Marc Fagel took to social media to address some misconceptions surrounding the Ripple case. In response to a user who claimed a settlement had already been reached between Ripple and the SEC, Fagel clarified that “there is no settlement” in the legal sense. He explained that a settlement requires a mutual agreement between the parties, whereas the current situation involves a final court judgment mandating Ripple to pay penalties for its legal infractions. The option to appeal that judgment is separate from a settlement.
Amid discussions about whether the SEC should continue pursuing the Ripple case, especially given the uncertainty surrounding potential appeals, Fagel highlighted the relevance of ongoing enforcement actions against cryptocurrency exchanges like Coinbase and Binance. He stated that these cases more directly address the issue of secondary sales, which are critical to the SEC’s regulatory framework. However, he acknowledged the challenges posed by the Ripple ruling on programmatic sales, which may complicate the SEC's broader enforcement strategy.
When questioned about the duration of the trial and its potential impact on the issuance of the RLUSD stablecoin, Fagel indicated that if the SEC appeals, the average timeline for a ruling in the Second Circuit is around 10-11 months. Following that, the case could return to the trial court for further proceedings, depending on the outcome of the appeal.
While he did not elaborate on the specifics of RLUSD, the ongoing legal proceedings could have significant implications for its issuance, as well as for the broader landscape of cryptocurrency regulation in the U.S.
As the SEC approaches the October 7 deadline, the decisions made in the Ripple case will not only impact Ripple Labs but could also set crucial precedents for the regulatory treatment of cryptocurrencies. Legal experts and industry stakeholders will be closely monitoring the developments, especially concerning how they may influence future enforcement actions and the regulatory framework surrounding digital assets.
September 2024, Cryptoniteuae