The U.S. Securities and Exchange Commission (SEC) vs. Ripple lawsuit will reach a conclusion behind a closed-door meeting on Thursday, July 18. This discussion will involve the settlement of injunctive actions, administrative proceedings, litigation claims, and other matters related to examinations and enforcement proceedings. As a result of this key event, XRP price is likely going to experience a significant burst of volatility.
Related: SEC vs. Ripple Lawsuit: Latest Updates & Impact on XRP Price
SEC and Ripple Legal Battle To End After More Than Three Years
On Thursday, July 18, the US SEC will hold a closed-door meeting to discuss the settlement of its lawsuit against Ripple. This closed-door session has sparked speculation that the regulatory agency may be close to reaching a resolution in the protracted case.
The case’s outcome could have far-reaching consequences for both Ripple and the broader cryptocurrency landscape. A favorable ruling for Ripple could validate XRP as a legitimate digital asset, potentially leading to a surge in its market value, investor confidence and adoption. Conversely, a verdict siding with the SEC could subject XRP to stricter trading regulations, potentially dampening its value. For now, speculators has a bias favoring the defenders.
Ripple’s Chief Legal Officer Stuart Alderoty stated,
“While our case as a whole isn’t fully over (remedies still to be decided), the Court’s ruling that XRP is not a security will not change (even the SEC told the Court it will not challenge that conclusion). Don’t be distracted by the SEC’s continued efforts to mire Ripple and the industry in the litigation trenches – that runway is running out for the SEC. Ripple and the entire industry has and will emerge stronger, long after Chair Gensler is gone.”
Will Ripple and XRP Win?
The legal landscape surrounding XRP remains murky, with conflicting rulings from different district court judges. In a recent case, Judge Phyllis Hamilton of the U.S. District Court for the Northern District of California suggested that XRP might be considered a security, contradicting Torres’ earlier decision. This lack of regulatory clarity is a persistent challenge for the cryptocurrency industry, with legal experts arguing that until a higher court or Congress provides definitive guidance, the confusion is likely to continue.
Ripple has remained steadfast in its defense, arguing that the SEC’s demands are excessive and lack merit. The company has offered a settlement of only $10 million, in contrast to the SEC’s initial request for over $2 billion in disgorgement.
As the crypto community eagerly awaits the outcome of the SEC’s closed-door meeting and the potential verdict, the resolution of the Ripple case could set a precedent for future cryptocurrency regulations, with far-reaching implications for the industry
SEC vs. Ripple Lawsuit FAQs
- Is XRP a security? The court ruled that XRP is not a security when sold on public exchanges to retail investors, but it is a security when sold directly to institutional investors by Ripple. This creates a distinction between different types of XRP transactions.
- What are the implications for the crypto industry? The ruling provides some regulatory clarity, suggesting not all digital assets should be classified as securities. This could shield many cryptocurrencies from strict SEC regulations, allowing more flexibility in the industry.
- What was the outcome of the case? The court issued a partial summary judgment, ruling that XRP sales on public exchanges did not constitute investment contracts, but Ripple violated securities law by selling XRP directly to institutions. The case is still ongoing.
- How does this impact XRP investors? For retail investors who bought XRP on exchanges, the ruling is positive as it means XRP is not considered a security in those transactions. However, the ongoing litigation creates uncertainty for all XRP holders.
- What is the significance for future crypto regulation? The SEC vs Ripple case sets an important precedent that could influence how other digital assets are classified and regulated going forward. It suggests a more nuanced, transaction-based approach rather than a one-size-fits-all securities designation.
