In a report that defies crypto enthusiasts’ expectations, Fox Business correspondent Eleanor Terrett reveals that the SEC is holding its ground in the legal battle with Ripple, even after dropping charges against its senior executives. The development unravels predictions that such dismissals would hasten the litigation’s end.
While the SEC recently retracted accusations against Ripple’s Brad Garlinghouse and Chris Larsen, it didn’t signify a softening of the commission’s approach, as outlined in Terrett’s insights. Spearheaded by Gary Gensler, the regulatory body maintains that XRP transactions should be treated as securities transactions, a perspective informed by internal sources at the SEC.
The origin of the discord can be traced back to December 2020, with Ripple drawing the SEC’s ire for allegedly orchestrating unregistered securities offerings. Central to the dispute was whether XRP, widely traded by various market participants, should be regulated as an investment contract. Ripple’s multifaceted sales approach, spanning institutional sales and digital exchange dealings, was a focal point of the SEC’s examination.
However, a watershed in this ongoing saga was the July 13 summary judgment. Presiding Judge Analisa Torres discerned that only Ripple’s institutional sales of XRP breached securities regulations, leaving automated and other sales categories untouched and challenging the SEC’s overarching stance.
Displeased with the ruling, the SEC considered an immediate appeal. Yet, the court recommended patience, favoring a full resolution before any such steps. As the accusations against individual executives fall away, attention shifts to what remedies the court might order, hinting at a nearing conclusion.
This phase’s unfolding hints at a potential appellate showdown in the Second Circuit, given the SEC’s steadfastness in pursuing comprehensive claims. This persistence could be part of a calculated attempt to corner Ripple into a significant settlement agreement by keeping the pressure mounted through continued litigation.
Terrett’s report underscores the broader implications of this struggle, reflecting the SEC’s dedication to establishing and enforcing a clear regulatory framework within the rapidly evolving digital currency realm. It signals to industry stakeholders that adherence to regulatory mandates is not optional and that deviations could invite intense scrutiny and punitive actions.