Ripple SEC case continues and court ruling incites confusion
The SEC is after Ripple Labs for a long time and it seems far from over with recent events. Catch up on their legal battle right here at Gamdom.
Ripple SEC case continues and court ruling incites confusion
The United States (US) Securities and Exchange Commission (SEC) has been after Ripple Labs since December 2020 and it appears that their legal battle is far from over. Latest developments in this story include Judge Analisa Torres ruling in favour of the blockchain-based company.
The ruling in question as quoted from the US court’s decision, ‘Ripple’s XRP offerings are unique’. This means that the digital asset should be treated as a different form of investment entirely that the SEC cannot regulate in the same way as a security.
The Bank of America (BAC) weighs in and says that the court’s recent rulings complicate the matter. If XRP is considered ‘unique’ then it cannot be beholden to follow a standard that the SEC can interpret. Therefore, it will remain to play by its own rules as a cryptocurrency that leaves undetermined implications in finance.
The ruling is in favour of the XRP, at least partially. It means its traders can continue using the digital asset on various industries albeit unclear with their freedom. The BAC still argues that a comprehensive regulatory framework is required to protect investors, especially in assets with high institutional engagement.
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What is the SEC accusing Ripple Labs of?
On 22nd December 2020, the SEC announced an action against Ripple Labs Inc. alleging that they raised more than $1.3 billion through unregistered digital asset securities. That asset in question is XRP, which the blockchain-based company and its users argue that it is not. This is a cryptocurrency and it should be beholden to the same standard as Bitcoin (BTC).
Through the years that the issue has been brought up, many exchanges and financial management companies have weighed in on the subject. Strategic Business Innovator Group (SBI Holdings) added that XRP is regulated as a crypto asset in Japan. That means it’s traded in decentralised (DeFi) and centralised exchange (CEX) similar to foreign exchange (Forex).
Shark Tank star and NBA team Dallas Mavericks owner, Mark Cuban, also chimed in and asserted that the SEC doesn’t have a say in Ripple’s assets. He states that the SEC’s referring to every buyer as an investor it must protect is wrongly decided. Cuban also says that the regulator’s attempts don't help small crypto investors and follow Japan’s policies on the matter.
What does the recent court ruling between Ripple-SEC imply?
The court rulings are, indeed, making it hard to determine the future of XRP. For now, it retains the same freedom as other crypto. It can be used as a mode of payment, store of value, and trading asset. Other uses include staking them at Bitcoin casino games and sports in Gamdom. The SEC is not giving up and it will argue that regulations must be placed so stay tuned for updates.
