SEC Loses Bid to Appeal Ripple Case: Xrp not a Security, Judge Rules
On Tuesday, a federal judge said that the U.S. Securities and Exchange Commission couldn’t review her recent decision about Ripple Labs. This is seen as a big loss for the SEC’s efforts to keep cryptocurrency markets safe.
In her ruling on July 13, U.S. District Judge Analisa Torres in Manhattan said that the sale of Ripple’s XRP digital coin on public exchanges was legal because buyers couldn’t expect to make money from Ripple’s work.
The SEC had asked for permission to review Torres’ decisions about “programmatic” sales of XRP and “other distributions” of XRP as a way to pay for services, saying that an appeal would be important for a “large number” of lawsuits.
But the judge didn’t think there was a “substantial reason to disagree” with her decisions and didn’t think an appeal would move the case any closer to a resolution.
She also said that her decision did not conflict with a July 31 finding by U.S. District Judge Jed Rakoff in Manhattan, who said that the SEC had a “plausible claim” that Terraform Labs’ Terra USD token was a security when it was sold on public exchanges.
Torres said that Rakoff was thinking about Terraform’s request to drop the SEC case and that he had to accept all fair inferences in favor of the regulator.
The court date for the Ripple case is April 23, 2024.
When asked for comments after market hours, the SEC didn’t answer right away. Ripple’s lawyers, CEO Brad Garlinghouse, and co-founder Chris Larsen did not answer similar questions right away.
In a case filed in December 2020, the SEC said that Ripple sold XRP without getting permission and illegally raised more than $1.3 billion.
The SEC has said for a long time that many digital assets, like stocks and bonds, are securities that it can control.
It has also sued Binance, which is the biggest cryptocurrency platform in the world, and Coinbase which is the biggest cryptocurrency platform in the United States.
In July, Torres found that only a small number of sales of XRP broke federal securities rules.
Case No. 20-10832 is SEC v. Ripple Labs Inc. and Others in the U.S. District Court for the Southern District of New York.
Also Read:
