Ripple vs the SEC: Will Ripple (XRP) win their lawsuit?
A look at whether Ripple has a chance to win their SEC lawsuit and what this means for XRP going forward.
While they might not ‘win’ their lawsuit per se, it’s looking likely that Ripple will receive a favourable outcome.
In the grand scheme of things, this is all that matter for not only XRP token holders, but also the wider crypto community looking for a legal precedent to be set.
This section of our Ripple (XRP) guide will introduce the SEC lawsuit and then discuss some of the key points that an XRP investor needs to be across.
Ripple Labs vs the SEC
On December 22, 2020, the Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs Inc, as well as two of its executives Christian Larsen and Bradley Garlinghouse.
They allege that the company raised over $1.3 billion through an unregistered digital asset.
But the lawsuit between Ripple (XRP) and the Securities and Exchange Commission(SEC) appears to finally be coming to an end, with the decision likely to be favourable to Ripple.
After ruling in favour of Ripple's appeal to include three other documents from the SEC privilege log, Judge Sarah Netburn has indeed handed Ripple the edge.
Ripple was also alleged to have distributed billions of XRP in exchange for non-cash considerations, such as market-making services and labour.
The allegation is that all up Ripple violated the registration provisions of federal securities law as it is expected that any issuer seeking public investment will register with the securities agency.
Only through the SEC may their financial condition be assessed and made known to the public.
Ripple’s successful appeal
As mentioned above, the judge ruled in favour of Ripple's appeal to include three other documents from the SEC privilege log.
Ripple was able to discover through a SEC privilege log, the existence of an email between the SEC and a third party.
This email featured the SEC telling them to assess a digital asset by using factors from a speech made by Former SEC chairman William Hinman on June 14, 2018.
In this speech, Hinman possibly set a precedent by confirming that Ethereum is in fact not a security.
The SEC however, counters this argument by claiming that it was a personal opinion of Hinman, rather than official policy.
There’s definitely doubt here and as a result, Ripple could be seen as favourites to now win the lawsuit.
When will Ripple’s lawsuit against the SEC be decided?
It’s looking like Ripple Labs vs the SEC won’t actually be decided until March 2022 at the earliest.
Financial cases, especially those of this magnitude, are notoriously slow moving.
But with a two month discovery extension to January 2022 dragging things out further again, there are a few more twists to come yet.
If no settlement is reached, which is still the likely outcome, the case won't be decided until March 2022 at the earliest.
With a higher likelihood of a decision not actually being reached until late spring if the court decides not to rule on some of the pending motions until after the discovery deadline.
While this could be construed as bad news for XRP token holders, it certainly hasn’t had that effect on price yet.
Will Ripple survive?
In one way or another, this section of our guide to Ripple (XRP) has shown that the token is most likely not only going to survive, but likely also thrive.
The longer things drag out, the more likely it is that Ripple either win their lawsuit against the SEC, or at the very least, reach a favourable settlement.
It’s true that initial news of the lawsuit made Ripple Investors dump their XRP which crashed the price of XRP below $1.
It also saw XRP delisted on many centralised exchanges as they were forced to weigh up the legal risks accompanying the suit.
However, with this particular lawsuit now the longest that the SEC has ever faced, the tide is turning.
We could actually see a favourable outcome propelling the price of XRP to new highs as exchanges relist the token.
Best of probabilities to you.
Direct from the desk of Dane Williams.
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This Ripple (XRP) blog is exclusive to leofinance.io.
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