In a recent development in the ongoing legal battle between Ripple Labs and the United States Securities and Exchange Commission (SEC), the SEC finally moves for appeal against Ripple. This is in relation to the dispute on whether XRP is considered a security and if Ripple wrongfully sold it as one.
A Significant Step by the SEC
The SEC has made a noteworthy move following Judge Analisa Torres’ partial ruling on July 13th. She declared that XRP was a security when sold to institutional investors, which resulted in the SEC’s motion being granted. However, the SEC’s motion concerning programmatic XRP sales was denied. Following this, the SEC filed a motion to file an interlocutory appeal.
An interlocutory appeal is essentially a formal request made by one party in a legal case to a higher court. This request seeks permission to appeal a specific decision or ruling made by a lower court before the entire case concludes. Legal experts, like John E. Deaton, consider it highly unlikely that the SEC’s motion will be granted by the judge. However, it’s not uncommon to have an interlocutory appeal if the question at hand is substantial, which is now for Judge Torres to decide.
The Pending Jury Trial
The case still has a pending jury trial, scheduled by Judge Torres for 2024. The jury will decide on the charges against Ripple CEO Brad Garlinghouse and Chairman Chris Larsen. They are accused of “aiding and abetting” in the institutional sales of billions of dollars in XRP.
XRP: A Security or Not?
The SEC’s filing does not contest that XRP itself is a security. Rather, it questions the programmatic and individual sales of XRP. Initial reactions on Twitter suggested that the SEC’s appeal could categorize XRP sales on exchanges as securities. However, this is not the case.
As pointed out by Bill Morgan, an Australian lawyer closely observing the case, Judge Torres did not just find that XRP itself was not a security. She also referred to the SEC v Telegram case and concluded that digital assets like the gram token are commodities.
The Judge’s ruling and the SEC’s appeal primarily focus on the specific allegations against Ripple, its executives, and their sales of XRP, not those on exchanges. The SEC also requested Judge Torres to withhold enforcing other parts of her judgment until an appeal decision is reached in the Second Circuit.
As the legal battle continues, the price of XRP has slightly decreased by 3.51% in the past 24 hours and fell 6% from last week, currently standing at $0.63, according to CoinMarketCap. For those keen on keeping a close eye on these developments and their impact on XRP’s price, the cryptoview.io application is an excellent resource.
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