The post SEC’s Appeal Raises Stakes in Ripple Lawsuit: XRP Holders to Suffer? appeared first on Coinpedia Fintech News
The cryptocurrency market has been abuzz with the latest update in the ongoing Ripple lawsuit.
On Wednesday, the U.S. Securities and Exchange Commission (SEC) announced its plan to appeal a court ruling that limited its power to regulate the cryptocurrency market. Ripple executives voiced their disappointment, calling the decision “misguided” and “infuriating,” although they were not surprised by it. Ripple is determined to fight this ruling in court and maintains that XRP is a non-security based on the current legal framework.
So, what do we make of these developments?
In a recent episode of the Thinking Crypto podcast, Attorney Fred Rispoli discussed the SEC’s appeal of Judge Torres’s ruling in the Ripple XRP case. He explored various aspects, including why the SEC chose to appeal and Ripple’s chances of winning.
Ripple’s Winning Odds
When host Edward asked Rispoli whether he expected the appeal, he expressed hope that it wouldn’t happen, but he estimated a 60% chance of the SEC going ahead with it. Rispoli noted that both the SEC and Ripple face significant risks in this situation.
Rispoli pointed out that if the panel reviewing the appeal tends to agree with the government, the SEC’s chances of winning could rise to 70-80%. However, if the situation appears more neutral or favors Ripple, their odds improve. He mentioned that a divided panel or a more balanced justice could lean towards Ripple’s side. Rispoli added that political influences are increasingly affecting accountability in American institutions, including the SEC.
Reasons Behind the SEC’s Appeal
When asked why he thinks the SEC appealed the ruling, Rispoli suggested that they plan to contest every loss. He indicated that some of their arguments might be more persuasive than others, particularly those related to the summary judgment motion and ruling, which cover many issues.
He explained that the SEC is mainly focusing on programmatic sales and other distributions. Rispoli emphasized the importance of programmatic sales and the complexities involved.
Ripple’s Programmatic Sales: What’s at Stake?
“The summary judgment opinion did not talk about secondary sales in the sense of you and I buying and selling from each other on Coinbase, it was explicitly excluded in the opinion, but in a way, it wasn’t because the programmatic sales for Ripple is just Ripple selling on an exchange. But you could easily make the argument, well, what’s the difference between Ripple selling XRP and Tony selling XRP to me on an exchange? And so that’s why the SEC wants to take it out, is because that argument can be used for the secondary sales as everybody kind of thinks about it, which is me, you, anybody else selling it.”
Rispoli also speculated that the SEC might try to appeal financial penalties. However, he doesn’t believe their attempts to secure a higher fine will succeed.
Implications for XRP Holders
Rispoli stressed that the most significant concern for XRP holders is the outcome regarding programmatic sales. He warned that if the SEC wins in the Second Circuit, it could negatively affect not just XRP holders but also major exchanges like Coinbase and Kraken.
The future of cryptocurrency hangs in the balance. Will Ripple emerge victorious, or will the SEC tighten its grip on the market? Let us know your predictions.